Ray Dalio is one of the most successful hedge fund managers ever and by one measure he is once again the top hedge fund investor of all-time, according to a report released on Tuesday.
LCH Investments says its estimates show that the hedge fund Dalio founded in 1975, Bridgewater Associates, has produced more net gains in absolute U.S. dollars than any other hedge fund, surpassing the legendary George Soros’ investment vehicles. Bridgewater’s Pure Alpha hedge funds have generated $45 billion in net gains since inception compared to the $42.8 billion produced by Soros’ funds, LCH Investments reported. Dalio has held the top spot on LCH Investments' list before, but lost it to the legendary Soros for the past two years.
Dalio’s Bridgewater Associates is the biggest hedge fund firm in the world, managing $155 billion. While Dalio’s hedge fund performance track record is strong, there are a few hedge fund managers who have produced better long-term returns. But given the huge amount of money Dalio has been able to raise and manage for many years, his track record in producing absolute dollars is unmatched. Dalio’s main Pure Alpha hedge fund has returned 13% net of fees since inception in 1991.
Still, 2015 was something of a mixed year for Dalio. While his Pure Alpha hedge funds manages to produce $3.3 billion in net gains in 2015, his All Weather Fund posted its second annual loss in three years, dropping by 7%. LCH does not include the $70 billion All Weather Fund, which pursues a so-called risk-parity strategy, in its analysis of Dalio and Bridgewater.
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LCH is a fund of hedge funds and its chairman, Rick Sopher, is also head of alternative multi-management at private bank Edmond de Rothschild. Sopher puts together his hedge fund ranking by contacting hedge fund managers and confidential sources and analyzing audited reports. Sopher also does the math for legendary hedge fund managers who no longer oversee outside capital, which is how guys like Soros end up on his list. Soros’ fortune is currently run through his Soros Fund Management family office, which manages some $30 billion.
The third most prolific hedge fund manager on LCH’s list is David Tepper, who runs Appaloosa Management in northern New Jersey. Tepper’s hedge fund performance track record is phenomenal, but he has never tried to accumulate an enormous asset war chest and has recently made an almost annual habit of returning some capital to his investors. Tepper currently manages some $18 billion and LCH Investments estimates that his Appaloosa has made $22.8 billion in net gains since inception.
Bill Ackman, the billionaire hedge fund manager who runs Pershing Square Capital Management, dropped off LCH Investments’ list after posting a net return of -16.5% in his main hedge fund in 2015. Edward Lampert’s ESL Investments hedge fund also fell off the list. Instead, Lee Ainslie’s Maverick Capital and Landsdowne Developed Markets, a European hedge fund, are now two of the top 20 hedge funds of all-time, according to LCH.
LCH does not include quantitative hedge funds like Renaissance Technologies in its survey, even though Renaissance’s returns would surely put it on such a list. Here are the top 20 hedge funds according to LCH:
