Biggest Hedge Funds Grow By 35%, JPMorgan Keeps Top Spot

May 21 2008 | 12:32pm ET

The hedge fund rich are getting richer, market turmoil notwithstanding.

The world’s largest hedge funds grew by 35% last year, according to Alpha magazine’s annual ranking. The top 100 firms manage $1.35 trillion, or 75% of all hedge fund assets under management. The top 10 firms manage $324 billion—almost one-fifth of total hedge fund assets and up 29% from 2006.

JPMorgan held on to the top spot in 2007 with $44.7 billion in hedge fund assets, driven by growth in its Highbridge Capital Management division. Highbridge saw its assets almost double to $27.8 billion on the year. JPMorgan managed $33.1 billion at the end of 2006.

Alpha attributed JPMorgan’s strength to “its combination of hedge fund risk and old-bank stability.”

Connecticut’s Bridgewater Associates and San Francisco’s Farallon Capital Management tied for second in the survey, with $36 billion in assets under management. In 2006, Bridgewater placed third and Farallon fifth. Also rising in this year’s rankings were Long Island’s Renaissance Technologies, which is in fourth place with $33.3 billion, edging out fifth-place Och-Ziff Capital Management, which ended the year with $33.2 billion. The two firms were ranked sixth and seventh, respectively, in 2006.

Less lucky were D.E. Shaw Group and Goldman Sachs, which fell from fourth and second place, respectively, to sixth and seventh, with $32.2 billion and $29.2 billion, respectively. At the end of 2006, Goldman managed $32.5 billion. Barclays Global Investors also fell one spot to ninth, with $26.2 billion.

New to the top 10 are Paulson & Co., which rode triple-digit returns last year to soar from 69th place to eighth with $29 billion, and GLG Partners, which rose from 11th to 10th with $23.9 billion. Man Investments ($20.9 billion) and ESL Investments ($13 billion) fell out of the upper echelon, to 11th and 38th place, respectively.

Other notable firms that took hits in the rankings were Tudor Investment Corp. ($16.1 billion), which fell from 12th place to 23rd, and Citigroup ($14 billion), which dropped from 13th to 33rd.

The Top 25 Hedge Fund Firms

rank firm assets
1 JPMorgan Asset Management $44.7 billion
2 Bridgewater Associates $36 billion
2 Farallon Capital Management $36 billion
4 Renaissance Technologies $33.3 billion
5 Och-Ziff Capital Management $33.2 billion
6 D.E. Shaw Group $32.2 billion
7 Goldman Sachs Asset Management $29.2 billion
8 Paulson & Co. $29 billion
9 Barlcays Global Investors $26.2 billion
10 GLG Partners $23.9 billion
11 Brevan Howard Asset Management $21 billion
12 Man Investments $20.9 billion
13 Atticus Capital $20 billion
13 Citadel Investment Group $20 billion
15 Lansdowne Partners $18.9 billion
16 Harbert Management $18.1 billion
17 Lone Pine Capital $18 billion
18 Soros Fund Management $17 billion
19 Avenue Capital Group $16.5 billion
20 BlueBay Asset Management $16.4 billion
20 Cerberus Capital Management $16.4 billion
20 Fortress Investment Group $16.4 billion
23 Tudor Investment Corp. $16.1 billion
24 SAC Capital Advisors $16 billion
25 Sloane Robinson $15.1 billion

source: Alpha magazine

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