Bridgewater Associates LLC, the world's largest hedge fund manager, is experiencing one of its hardest years after assets under management fell precipitously.
Its flagship global macro strategy — Pure Alpha — was down 20% in the first quarter this year in response to the impacts of the COVID-19 pandemic on global markets.
Bridgewater's total assets under management fell 12.5% to $140 billion through June 30 from $160 billion as of Dec. 31. After better performance in July and August, total AUM rose to $148 billion as of Sept. 1, down 5.7% from year-end 2019, data from Bridgewater showed.
"Bridgewater has gray clouds hanging over it right now with a lot of challenges ahead including performance issues, AUM decline, employee layoffs and persistent negative press," said Michael S. Falk, a partner at manager advisory firm Focus Consulting Group Inc., Long Grove, Ill.
Mr. Falk was referring to two high-profile lawsuits regarding former employees that Bridgewater has been involved in this year.
"Bridgewater likely will lose a fair amount of assets until a strong comeback happens, but when you have more than $100 billion of AUM, you do have a strong leg to stand on," Mr. Falk added.
However, Bridgewater has a plan.