Institutional Investor have just published their latest list of the top hedge fund earners from 2017. To make things easier I have converted the list into the table show below. The return column is the return for 2017 from the groups highest performing fund.
I then decided to reorder the table based upon performance. I then highlighted those managers who failed to beat the S&P 500 Total Return Index.
It is interesting that those that pay themselves the most have on average the poorest performance. Intriguingly this tallies with a paper a paper I read decades ago that looked at the performance of a company as a function of what the CEO was paid – the more the CEO was paid the worse the overall performance. The great thing about being a fund manager is that if you charge a constant management fee and continually attract new funds then the amount you make simply rises on that tide. This is how local superannuation manages will generate $30 billion in fees this year for not doing their job – money just keeps pouring into superannuation.