Hedge fund and fund-of-funds firms tracked by Pensions & Investments managed more than $1 trillion in worldwide assets at the end of 2009.
That's nearly half of the $2.2 trillion that Hedge Fund Research Inc., Chicago, estimated made up the hedge fund industry as of Dec. 31.
Using a combination of direct surveys with money managers, interviews with fund company executives, industry sources and — for the first time — regulatory filings, P&I compiled a ranking of 95 companies managing at least $1 billion in combined hedge fund and fund-of-fund assets from clients worldwide.
About 60% or $611 billion of the $1.01 trillion total from P&I's ranking was managed in single- and multistrategy hedge funds with the $401 billion balance managed in funds of funds.
The 25 largest companies, all managing at least $17 billion, ran $654 billion or 65% of total hedge fund and fund-of-funds assets in P&I's universe. The top companies managed $410 billion in single- and multistrategy hedge funds and $243 billion in funds of funds.
(A full list of hedge fund/fund-of-fund managers with at least $1 billion of combined assets is available at http://www.pionline.com/wwmanagers.)
The largest manager was Bridgewater Associates Inc., which managed $43.6 billion in multistrategy hedge fund assets as of Dec. 31, followed by Man Group, with $25.3 billion in direct hedge fund assets and $17.1 billion in funds of funds. BlackRock Inc. with $23.7 billion managed in direct assets and $16.6 billion in funds of funds, occupied third place.
BlackRock is a relative newcomer to the cadre of large hedge fund managers, pushed by the 2009 acquisition of Barclays Global Investors. BGI reported hedge fund assets of $17 billion the previous year, while BlackRock's hedge fund assets totaled $8.2 billion. BlackRock spokeswoman Lauren Trengrove warned that a precise comparison of 2008 with 2009 wasn't possible because BlackRock recategorized a number of investment strategies when it integrated BGI into the company.
Still, industry sources said BlackRock now is a more serious contender in the hedge fund industry, especially for institutional allocations, thanks to the addition of BGI's mostly institutional hedge fund family.
BlackRock also followed an acquisition approach for hedge funds of funds with the acquisition of Quellos Group LLC, which managed $21.9 billion when the deal closed late in 2007.