A hedge fund is a sophisticated investment product that generally contains a mix of leveraged derivatives, as well as long and short positions. Hedge funds may invest in both domestic and international markets and typically target high-net-worth individuals, pension funds, and institutional investors. Typically imposing $1 million investment minimums, hedge funds are categorized as alternative investments that often outperform the broader market. But they invariably carry higher risk than traditional investments, owing to the fact that they're unregulated by the U.S. Securities and Exchange Commission (SEC) and other oversight bodies.
The following 10 hedge fund firms dominate the space, based on total assets under management (AUM). Figures are sourced from both official company sources and external reports.
The World’s Top 10 Hedge Fund Firms
- Bridgewater Associates. This Westport, Connecticut-based hedge fund firm is the world’s largest, with over $130 billion in hedge fund assets, and $150 billion in total AUM as of February 2020. Founded in 1975 by Ray Dalio, Bridgewater’s global institutional client base comprises pensions, charities, college endowments, and central banks.
- Renaissance Technologies. Found in 1982, this New York-based quantitative hedge fund was created by James Simons and is currently run by Peter Brown. With some 600 employees, the firm controls approximately $68 billion in AUM.
- Man Group. This British hedge fund boasts some $62 billion in hedge fund AUM as of June 2019. Although headquartered in London, Man Group holds offices in various world hubs, including Boston, Tokyo, New York, and Hong Kong. Its overall market capitalization was $2.85 billion as of January 2020.
- AQR Capital Management. With a whopping $61 billion in hedge fund AUM, AQR’s total asset eclipsed $185 billion in September of 2019. Launched in 1998 by David Kabiller, Robert Krail, John Liew, and Cliff Asness, this quantitative investment house has approximately 1,000 employees operating out of Boston, London, Chicago, Greenwich Tokyo, Hong Kong, and Los Angeles. It recently opened an office in Frankfurt, Germany.
- Two Sigma Investments. This American hedge fund employs scientific methods to quantitatively invest its $43 billion in AUM. Based in New York, the fund was launched in 2001 by Mark Pickard, David Siegel, and John Overdeck. It also has offices in Hong Kong, Japan, and the United Kingdom.
- Millennium Management. Launched in 1989, this global hedge fund firm offers discretionary investment advisory services to private funds. With AUM of $40 billion as of December 2019, the New York-based firm has offices in Geneva, Tokyo, Hong Kong, Singapore, London, and Greenwich, that collectively employ more than 2,700 individuals.
- Elliott Management. This privately-owned American hedge fund was launched in 1977 by billionaire Paul Singer. With some $38 billion in AUM as of June 2019, the company invests in public equities, distressed securities, fixed income investments, alternative investment markets, and real estate-related securities. Based in New York, the firm has offices in Hong Kong, Tokyo, and the United Kingdom. With 465 employees, the firm announced plans to acquire retail bookseller giant Barnes & Noble Inc., in June of 2019.
- BlackRock. With hedge fund AUM of 33 billion, this New York-based investment manager has total assets exceeding $7.4 trillion. BlackRock shares are traded on the New York Stock Exchange (NYSE) under the ticker symbol BLK.
- Citadel. With $32 billion in investment capital as of September 2019, the Chicago-based firm relies on quantitative analysis to invest in credit, fixed income, commodities, and equities. Founded by billionaire Kenneth Griffin in 1990, the firm presently employs more than 1,600 people across offices in San Francisco, Boston, Shenzhen, New York, Houston, Dallas, Hong Kong, Toronto, London, and Shanghai.
- Davidson Kempner Capital. This global asset manager boasts nearly $31 billion in AUM, focusing on bankruptcy, convertible arbitrage, merger arbitrage, distressed investments, event-driven equities, and restructuring situations. Founded by Marvin Davidson in 1983, the firm employs 350 individuals in offices operating out of London, New York, Dublin, and Hong Kong.