Bloomberg recently breathlessly trumpeted the following regarding hedge fund behemoth Bridgewater –
Ray Dalio Makes Clients $4.9 Billion in 2016 as Paulson, Soros Falter
Their article was accompanied by the following table of returns –
When you look at the table $4.9B is a lot of money in absolute terms and it is here that it all falls down since absolute terms are largely meaningless. So I reordered the data and turned the returns into relative or percentage returns and as expected things look a little different.
All of a sudden the returns are not that impressive and it wouldn’t be a posting without a chart with some sort of reference figure.
As is typical of hedge funds they all under performed the S&P500 Total Return Index. I will be interested to see when the 2016 rankings for hedge fund salaries come out how much of investors gains have been swallowed up by the avarice of the funds owners.
It appears there may have been significant fund deposits and withdrawals and therefore my view is more information is needed to accurately assess the funds performances. For example Soros has net gains of 41.8B but funds under management of 28B. It is possible Paulson and Co. may have suffered significant client withdrawals as well as poor returns in 2016.