Whether celebrated or condemned for their occasionally hair-raising exploits, these investment vehicles have long been described as secretive, even shadowy. For many reasons, warding off imitators is one, they prefer it that way.
From our start in 1967, Institutional Investor has chronicled this heady mix of money and mystery. In “The Mystique of the Hedge Funds,” our August 1968 cover story, former editor Peter Landau examined the stunning growth and success of the business: “From a mere handful only a couple of years ago, the number now tops 100,” he wrote. “And even if their total assets, by most estimates, amount to less than $2 billion, they swing an inordinate amount of financial weight for their size.”
Through the years we extended this pioneering coverage with profiles of luminaries like George Soros, Julian Robertson, Michael Steinhardt, John Meriwether and James Simons while hedge funds proliferated. About 6,000 exist today, with some $600 billion in assets. Once the playground of the rich, hedge funds now count pension funds, endowments and foundations among their investors.
This month we,ve set out to peel back another layer or two of the hedge funds, mystique, beginning with the subject of our cover , the astounding sums of money these managers make. In “That,s Rich!” Contributing Editor Stephen Taub estimates that last year, despite rotten markets, no fewer than four hedge fund superstars, led by the inexhaustible Soros, pocketed more than $400 million apiece. And those figures, Taub stresses, are conservative ones.
Rankings are one of this magazine’s specialties, and in this issue we introduce a new one, the Hedge Fund 100, which tallies the biggest funds in the world. This list, which took months to put together, was compiled under the guidance of Senior Editor Jane Kenney and Contributing Editor Lewis Knox; they were assisted in their efforts by a team of reporters and researchers that included Taub, Senior Editor Hal Lux, Staff Writers Rich Blake and Justin Dini and researchers Michele Bickford and Polly Watson. It wasn,t easy to do , some funds preferred to keep their secrecy , but we hope our efforts have produced a definitive ranking.
Most folks in the hedge fund world would prefer to stay anonymous. But with $600 billion at stake, that notion seems as quaint as a seven-figure income.
