MSNBC -James Simons of Renaissance Technologies and T. Boone Pickens Jr of BP Capital Management raked in $1.5bn and $1.4bn in 2005, putting them at the top of the Institutional Investor’s Alphamagazine list of the Top 25 highest paid hedge fund managers.
This year’s list, the industry standard and a must for those who want to follow the money in the hedge fund industry, marks the first time two fund managers have earned more than $1bn.
The 26 hedge fund managers on the list (one extra due to a tie for 25th place) earned $363m on average – up 45 per cent from the $251m average in 2004. The top slots are an indication of the trends and strategies that are leading the hedge fund industry.
Mr Simons, who routinely turns up on the list, runs one of the best-regarded hedge funds that uses mathematically driven strategies – a category of quantitative funds whose numbers and size are growing.
Given the hefty fee structure of Renaissance’s flagship fund – 5 per cent management fee and 44 per cent performance fee, compared with the typical 2 per cent and 20 per cent – and the extraordinary gross return of nearly 60 per cent, it was a banner year.
