Ken Griffin’s Citadel, Steve Cohen’s Point72 lagged 2023 market

Business

By Lydia Moynihan

Major hedge fund moguls including Ken Griffin, Steve Cohen, and Izzy Englander failed to keep pace with the S&P 500 and the Nasdaq in what proved to be a difficult year for money managers.  

While Griffin’s Citadel led the pack when it came to performance, his flagship fund — the name typically given the premier fund — only managed to notch gains of 15.3% for the year, according to reports.

In comparison, the S&P climbed 24% while the Nasdaq rose 43% — pushed higher by top performing tech stock like Nvidia.

Gains at other large funds were even weaker. Steve Cohen’s Point72 Asset Management ended the year up 10.6%, Izzy Englander’s Millennium Management gained 10% and D.E. Shaw’s flagship fund returned 9.6%, these reports add.

Citadel’s and D.E. Shaw’s non-flagship funds performed even more poorly.

Citadel’s tactical trading fund gained 14.8%, its equities fund yielded 11.6%, and its fixed income fund returned 10.9%.

D.E. Shaw’s oculus fund returned 7.8%. 

Smaller hedge funds ended the year even lower than their larger peers.

Michael Gelband’s ExodusPoint ended the year 7.3% higher, Veriton brought in returns of 8.2%, Lauren Capital returned 5%, Minnesota-based Walleye returned 3.9%, Schonfeld Strategic Partners returned 3% and Balyasny eked out a 2.7% return.

One notable exception: A little known fund, Discovery Capital, managed to bring in returns of 48%.

While 2023 was marked by volatility — regional bank collapses, a war in the Middle East and ongoing inflation — it evidently didn’t translate to better returns for active money managers who so often profit on market uncertainty.

In 2022, when major indices plummeted hedge fund managers were able to capitalize on the volatility and generate huge returns.

While the S&P lost nearly 20% and the Nasdaq fell roughly 33% in 2022, AQR raked in 44%, Citadel’s flagship fun notched a 38% return.

D.E. Shaw was up nearly 25%, Millennium was up 12% and Point72 ended the year up 10%.

Over the last few years, some investors have debated whether investing is hedge funds is worth it given they often provide disappointing returns.

Unlike hedge funds which typically charge a 2% management fee, take a 20% cut on all returns, and only accept cash from large investors, anyone can easily invest in a major index — and they get to keep their profits.