Top Earning Hedge Fund Managers – The small budget manager is expected to earn about $2 billion in 2021, largely thanks to an 11-year bet on Avis Budget Group Inc., and that bet has paid off handsomely. Shares rose 456 percent.
It’s safe to say that Sarma is not your typical Manhattan banker. During the pandemic, he did not flee to the Hamptons, Palm Beach or Aspen like many other important people on Wall Street. Instead, he moved in with his sister and her family in their small house in a middle-class suburb of New Jersey, where the houses are right next to each other – and there’s only room for two cars on the street.
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Sarma, 47, also runs his own company in a different way. At SRS Investment Management, he avoids spending more than other mutual funds and writes a stronger short book. In addition, he is not afraid to make large investments – and hold out as long as possible.
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That helps explain why Sarma is near the top of Bloomberg’s 2021 earnings rankings, just narrowly behind Citadel’s Ken Griffin and TCI Fund Management’s Chris Hohn. According to a Bloomberg Billionaires Index analysis, SRS owns about 50 percent of Avis through stocks and shares, which helped triple Sarm’s net worth to $3 billion and rewarded investors in his fund with a 35 percent increase.
It is the most successful, with all these companies managing more than $40 billion, compared to $8 billion for SRS.
Sarma’s former boss, Tiger Global Management founder Chase Coleman, was downgraded as his hedge fund suffered from stock market volatility in the last two months of the year. However, the company’s private equity arm is feeling good about cushioning the blow.
Other managers not included in the new ranking include Andreas Halvorsen of Viking Global Investor and Gabe Plotkin of Melvin Capital Management. Both hedge funds posted their biggest annual losses last year. Melvin was hit by short pressure on GameStop Corp., which peaked during January’s meme mania, while Halvorsen told investors that Viking made a “bad bet” without gauging the impact of the spread.
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Last year was a tough one for many managers as concerns about inflation and financial policy weighed on stocks and bonds, confusing shareholders with macro funds such as Element Capital, whose founder Jeff Talpins also disappeared from the Bloomberg rankings. It’s a grim face from 2020, when a booming economy propelled investment titans to record profits and 15 managers took home a combined $23 billion. This time it is worth less than US$15.8 billion.
Due to the impact, several fund managers appeared on the list for the first time, including Stephen Schoenfeld, Richard Mashal and Dan Loeb of Third Point.
Senvest Capital Mashaal made $123 million in January 2021 alone with a long bet on GameStop, which rose 1,625 percent that month. Senvest, which was one of the video game retailer’s largest shareholders, pulled out of the company before the stock tumbled in February.
Schonfeld Strategic Advisors, meanwhile, has grown rapidly and now has about $11 billion in investment funds, closing in on other serious rivals like Citadel and Izzy Englander’s Millennium Management. Each posted double-digit growth last year, and Schoenfeld’s major corporations at his company helped him earn about $300 million.
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Bloomberg’s analysis of CEO earnings looked only at their big investments and long-term returns, and did not include private equity holdings. It also doesn’t include investors who don’t have outside capital, such as Michael Platt of BlueCrest Capital Management.
Sarma, who came to the United States from India to pursue a master’s degree in operations science at Princeton University, joined Tiger Global a few months after its 2001 launch. According to those in the know, he was considered the company’s most capable non-partner. him at that time. Five years later, he struck out on his own, using his father’s name as the name of his new company.
The initial plan was to invest in Indian private equity as well as international stocks, but it soon shifted almost entirely to public companies, especially technology stocks.
Netflix Inc. has become one of the biggest money makers, investors say Sarma profits when the stock goes up and down. As of 2007, his fund had an annualized return of about 12 percent, beating the S&P 500’s 11 percent.
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Sarma typically owns about 25 stocks he wants to buy and 35 he expects to lose, according to investor and regulatory filings, meaning his risk is generally low. Friends again.
The Avis rate is different for him. It’s the biggest and longest he’s ever done, and the only one where he or anyone else in the company sits on the company’s board. Hedge funds are often avoided by hedge funds because of restrictions on when they can buy and sell stocks.
Sarma took the long-term view that companies capable of operating trucks effectively will have a positive impact on the future of human transportation.
Despite the decision, Sarma couldn’t help but make some money, selling about 5 percent of his holdings when Avis had his meme moment. The share more than doubled on Nov. 2 after the company announced it would play a leading role in the adoption of electric vehicles in the United States.
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The jump in Sarma’s net worth is particularly significant because the investments are spread across several portfolio companies and he himself owns roughly 90 percent of the fund, which is owned only by the Avis organization.
Sarma, now back in New York, is having a tough January along with many other pickers. Avis fell 15 percent. However, SRS’s main fund lost just 4.5 percent for the month, outperforming the S&P 500 and many other hedge funds. For the fifth time in seven years, the 83-year-old founder of Renaissance Technologies, which specializes in quantitative analysis, tops Institutional Investor’s rich list. , the latest ranking of the highest-paid hedge fund managers.
Simmons returned to the throne after earning $3.4 billion in 2021, replacing last year’s leader, Israel “Izzy” Englander. The founder of Millennium Management is set to drop to second place after being “only” $3.1 billion in 2021.
Last year, the top 25 highest-paid fund managers earned a combined $26.64 billion, the second-highest total in the history of the Rich after 2020 alone.
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Over the past two years, Wealthy First Group members have collectively earned more than $58 billion.
This year, $260 million is needed to make the main list. (A second group of top earners outside the top 25 will be announced in the coming weeks.)
Eight managers earned at least $1 billion last year, with the median earner, Philippe Laffont of Coatue Management, taking home $800 million, even though his hedge fund is up less than 6 percent in 2021.
Only two people are eligible to make the rich list for the first time: Karthik Sarma of SRS Investment Management, who received money from the main entities of budget group Avis as its shares rose the most by five times, and Richard Mashal of Senvest Management, the top performer on the rich list , with a profit of more than 85 percent.
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Simons, the richest of the rich, is the only money manager to have qualified for the full 21 years since the rating was created. This year, the mathematician took fifth place in the ranking over the past seven years. The 83-year-old actor’s best actor was once again the Medallion Fund, which is only available to insiders. Last year it grew by 48 percent. Meanwhile, Simons’ three public funds reported returns of 10.5 percent and 20.5 percent billion after 2020 revenue amounted to approximately 15 billion dollars.
The 52-year-old Wall Street veteran Englander slipped to second place after climbing last year. No need to shed any tears: His Millennium USA multi-year fund returned 13.6 percent (Millennium International did more or less in line), putting him in the middle of the strategic pack. Today, the 33-year-old firm’s 278 advisory groups manage more than $53 billion in assets across four primary strategies: relative value, arbitrage equity, income and multiple strategies. Last year, the number of employees of the company also increased by 17 percent. By the end of the year, Millennium had returned $15 billion to investors in the year-end redeemable share class and raised $13.7 billion in the long-term closed-end class.
Griffin outperformed many of its peers last year with a 26.26 percent gain, marking the third year in a row that Citadel has maintained its return of more than 19 percent in 31 years. All five of Wellington’s core strategies – equities, bonds, global and macro fixed income, credit and multiples – are profitable. Citadel, which manages about $46 billion, invested $2 billion in MelvinCapital Management last year after the short-term fund lost funding in early 2021. Since then, the firm has repurchased a significant portion of the investment. As for Griffin’s political career, the Republican Party announced last year that it would not support another candidate, Donald Trump.
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