Citadel is now the most successful hedge fund ever after making $16 billion last year – its biggest annual windfall ever.
The Miami-based fund, founded and led by Ken Griffin, is estimated to have topped the 2022 ranking of the world’s best-performing hedge funds of LCH Investments NV. The huge gains came as many other investors suffered from the sharp declines in the stock and bond markets.
Citadel’s record performance last year brought total earnings for the fund to nearly $66 billion since its inception. That knocked Ray Dalio’s Bridgewater — with earnings of $58.4 billion — from the top spot for the first time in seven years.
Dalio’s fund earned $6.2 billion last year, bringing total assets under management to $81 billion. Citadel manages $62 billion in assets.
“[Citadel’s $16 billion profit] even surpasses [John] Paulson’s 2007 gain, which has been described as ‘the largest trade ever’,” Rick Sopher, chairman of LCH Investments, said in a press release Monday.
Paulson, an investor, made $15 billion in 2007 after betting that the value of subprime mortgage-backed securities would collapse, an event that helped trigger the global financial crisis.
“[Citadel’s] the progression in the rankings in recent years has been remarkable,” added Sopher.
Sopher said Citadel, which began in 1990, does not rely on an investment strategy tied to rising asset prices, and has “multiple sources of profit,” two factors that could explain the record earnings despite a volatile ride for markets last year.
Overall, the top 20 hedge funds made $22.4 billion net profit in 2022, down nearly 66% from the previous year as markets moved up, according to data from LHC Investment. By comparison, the S&P 500 index lost approx Last year 19%.
Citadel told CNN it would not comment on any story related to his performance.
LCH was launched in 1969 and is the world’s oldest fund of hedge funds.