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LCH Investments: Aggregate hedge fund net investment gains lower in 2018

Aggregate net investment gains by hedge fund managers in 2018 were down $41 billion compared to a net gain of $181.5 billion in 2017.

The 10 largest hedge funds' net gains totaled $11 billion for the year ended Dec. 31, down 57.2% from net gains of $25.7 billion the previous year, showed data released Tuesday by hedge funds-of-funds manager LCH Investments, a subsidiary of Edmond de Rothschild Capital Holdings.

The 20 largest hedge funds in LCH's universe showed net gains of $23.2 billion in 2018, down 40% from $38.7 billion in net gains in 2017.

Despite the lower investment gains by hedge fund companies in 2018, the aggregate assets under management of the 10 largest hedge fund managers rose 4.2% to $367 billion and the AUM of the 20 largest managers increased 10.6% to $569.5 billion during the year.

Assets managed by the full universe of hedge fund managers tracked by LCH Investments, on the other hand, declined 2.4% to $3.189 trillion in the year.

LCH researchers also analyzed net investment gains of hedge fund firms since inception and found that Bridgewater Associates topped the list of the 20 largest hedge fund managers with $57.8 billion as of Dec. 31, compared to $49.7 billion the prior year. Bridgewater managed a total $133 billion in hedge funds as of the same date.

There was no change over the year ended Dec. 31 in Soros Fund Management's assets under management of $27 billion, and it has had net investment gains of $43.9 billion since inception, LCH data showed.

Also in LCH's top five hedge fund manager ranking by net gains since inception were Citadel, with $30.7 billion and total AUM of $28.6 billion; D.E. Shaw Investment Management, with net gains of $29.1 billion and AUM of $27.5 billion; and Baupost Group, which had investment gains of $27.4 billion on $27.4 billion of AUM.

Bridgewater also topped LCH Investments' list with net investment gains in the year ended Dec. 31 of $8.1 billion, while Lone Pine Capital experienced the largest net decline of $1.3 billion. Lone Pine had the largest net gain — $5 billion — in 2017 among the hedge fund managers LCH analyzed.