The top 25 US hedge fund managers earned more than $11bn last year – one of their worst-ever years.
It might sound like a lot, but the collective $11.6bn taken home by the 25 leading (all male) hedge fund managers in 2014 was roughly half what they collected in 2013 and the lowest since the 2008 financial crisis.
Institutional Investor’s Alpha magazine, which conducts the annual hedge fund pay survey, described the earnings as “paltry” despite their collective personal earnings being more than the gross domestic product of Nicaragua, Laos or Madagascar.
“How bad was [2014]?,” Alpha magazine said. “The 25 hedge fund managers on our 14th annual Rich List made a paltry $11.62bn combined, barely half of the $21.15bn the top 25 gained the previous year and roughly equal to what they took home during nightmarish 2008.
“Harsh memories of the global financial crisis pervaded Wall Street in 2014 – at least, for the highest-earning hedge fund managers,” Alpha said.
Alpha said the average 2014 earnings were “just $467m” down from $846m in 2013 – which is still 18,800 times the average US salary of $44,888.
The top three managers – Citadel’s Kenneth Griffin, Renaissance Technologies’s James Simons and Bridgewater Associates’ Ray Dalio – all made more than $1bn last year, with Griffin claiming the top spot with $1.3bn.
In 2013, the top performing hedge fund manager David Tepper of Appaloosa Management took home $3.5bn after big bets on airline stocks paid off.
No woman has yet made the list, which has been running for 14 years.
Hedge fund managers typically get paid based on a structure known as “two and 20”, in which they collect a 2% fee on the assets they manage and earn 20% of the profits they make for investors.
