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The Rankings

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James Simons
Renaissance Technologies
Size: $24 billion
Style: Quantitative investor
Location: East Setauket, N.Y.
Former math professor is king of the “black box” investors—funds that use top-secret algorithms and invest largely by computer. Shocked peers when he set a target of $100 billion for his latest fund. Charges 5 & 44, a fee structure without peer in the hedge-fund world—but nobody’s complaining. Net worth estimated at $4 billion.
Old Hand: “Simons doesn’t hire anyone who actually knows where Wall Street is. It’s all Ph.D.’s over there. They use algorithms that nobody understands but seem to work very well.”
Hedge-Fund Investor: “Along with Dalio, co-king of the quants.”
Young Buck: “Among other things, Simons is surely one of the top-paid managers over the past few years.”


David Shaw
D.E. Shaw & Co.
Size: $26.3 billion
Style: Quantitative investor
Location: Manhattan
Helped develop Morgan Stanley’s automated trading system. Former computer-science professor left to start own fund—in the prosaic realm of statistical arbitrage—in 1988. Stepped back from active management to focus on biomolecular research, but still takes home the biggest paycheck, an estimated $500 million in 2005. Estimated net worth of $1 billion.
Old Hand: “A quiet firm that has accumulated enormous assets. He just hired Larry Summers off the beach after Harvard.”
Young Buck: “One of the largest hedge funds in the world at the moment, isn’t it?”


Clifford Asness
AQR Capital Management
Size: $9.5 billion
Style: Quantitative investor
Location: Greenwich, Conn.
Yet another in an ever-lengthening list of former Goldman Sachs prodigies to head out on his own, founded AQR in 1998 with partners David Kabiller, Robert Krail, and John Liew. At the time, the rationale was said to be Goldman’s reluctance to pay his team based on performance, a practice the firm has since partly adopted. Known as much for his writing as his investing.
Old Hand: “Built a great business. But a lot of people are puzzled by a somewhat soft performance last year.”
Hedge-Fund Investor: “They’ve brought in AMG as an investor. I think they bought 25 percent or so.”


Ray Dalio
Bridgewater Associates
Size: $30.2 billion
Style: Quantitative investor
Location: Westport, Conn.
If there were a high philosopher of hedge funds, Ray Dalio would want to be that man. Prone to aphorisms such as “Bridgewater is a community in which our fates are intertwined” and “Money doesn’t bring happiness; the pursuit of excellence does.”
Old Hand: “A truly brilliant quant, but his results have been mixed.”
Hedge-Fund Investor: “Along with Simons, co-king of the quants.”
Young Buck: “Steady but unspectacular; quietly built a money-management powerhouse.”


Mark Carhart
Goldman Sachs Asset Management
Size: $32.5 billion
Style: Quantitative investor
Location: Manhattan
Former University of Chicago academic co-helmed Goldman’s flagship Global Alpha fund in 1997, after colleague Cliff Asness bolted for greener pastures. Although he got off to a good start, it’s been bumpy of late: suffered a 6 percent loss in 2006, setting tongues wagging all over Wall Street. The former high-school math-team champ has all eyes upon him in 2007.
Hedge-Fund Investor: “Whoa, did he ever have a crappy 2006.”


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