Bridgewater Tops JPMorgan As Largest Hedge Fund

Mar 5 2009 | 1:14am ET

Connecticut’s Bridgewater Associates has dethroned JPMorgan Chase as the largest hedge fund manager in the U.S.

Like most hedge funds, Bridgewater bled assets during the second half of last year. The firm managed 11% less on Jan. 1 than it did in July, according to Absolute Return magazine, which compiles the biannual list. But $38.6 billion in assets was good enough to overtake JPMorgan, which saw its hedge fund assets under management fall 26% to $32.9 billion. At the beginning of last year, JPMorgan, which owns Highbridge Capital Management, boasts $44.7 billion in hedge fund assets.

The shakeup at the top was not the only movement among the top ten. Paulson & Co. and D.E. Shaw Group swapped places at third and fourth, with the former’s assets dropping 16% to $29 billion and the latter’s falling 22.9% to $28.6 billion. Och-Ziff Capital Management held steady at fifth place, where it remained all of last year, with $22.1 billion in assets, a 33.6% decline from July.

Soros Fund Management was a new entrant into the top 10, coming in sixth with $21 billion in assets. For its part, Goldman Sachs Assets Management, which had been steadily falling in the rankings, rebounded into seventh place, but continued to bleed assets, losing another 23.4% to fall to $20.6 billion. Also continuing their steady declines were Farallon Capital Management and Renaissance Technologies. The third- and fourth-largest hedge funds in the U.S. just a year ago, they are now tied for eighth, with $20 billion in assets. San Francisco-based Farallon lost more assets than any other hedge fund, falling 44.4% from $36 billion. Long Island’s RenTech shed 31% of its assets, which stood at $29 billion at the end of the first half of 2008, in the second half.

Barclays Global Investors rounded out the top ten, with $17 billion in assets, narrowly edging out Boston-based Baupost Group, whose assets soared 49% last year to $16.8 billion.

Absolute Return’s figures also show that New York remains the dominant hedge fund center in the U.S. The Empire State is home to 121 firms, including seven of the top 10, with a combined $680 billion in assets. Connecticut is a distant second with 29 firms managing $149 billion, followed by California with 25 firms managing $96 billion.

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