Hey Ray Dalio, there are MORE than 8,000 pilots!

Hey Ray Dalio, there are MORE than 8,000 pilots!

October 19, 2015 Uncategorized
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(Last Updated On: October 19, 2015)

Ray Dalio, famous for running Bridgewater, the world’s largest hedge fund, is famous for mocking the growth in the hedge fund industry:

There are about 8,000 planes in the air and 100 really good pilots.

Every time I hear that quote I think, “Wow, so many managers are out there trying to get paid big fees!”

Well, 8,000 is a LOW guesstimate of the planes in the air…

Turns out there are over 24,000 pilots going for the “2/20” payment scheme (~10,000 identify as hedge fund specific).

Here is a link to the recent compilation of the private fund statements from form PF and ADV data (h.t., Cipperman Compliance).

Here is the table on the # of funds in the private fund space–24,000+! Wow.

www.sec.gov_divisions_investment_private-funds-statistics_private-funds-statisti_2015-10-19_08-28-16

And who are the suckers buying all these things? Government and private pension plans.

www.sec.gov_divisions_investment_private-funds-statistics_private-funds-statisti_2015-10-19_08-30-51

 


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Wesley R. Gray, Ph.D.

After serving as a Captain in the United States Marine Corps, Dr. Gray earned a PhD, and worked as a finance professor at Drexel University. Dr. Gray’s interest in bridging the research gap between academia and industry led him to found Alpha Architect, an asset management that delivers affordable active exposures for tax-sensitive investors. Dr. Gray has published four books and a number of academic articles. Wes is a regular contributor to multiple industry outlets, to include the following: Wall Street Journal, Forbes, ETF.com, and the CFA Institute. Dr. Gray earned an MBA and a PhD in finance from the University of Chicago and graduated magna cum laude with a BS from The Wharton School of the University of Pennsylvania.


  • Moses

    That is scary. Lots of people’s retirement such as firemen, nurses , and teachers investment funds are perhaps going into risky investment funds. I wonder how much of the fund money is being lost due to just fees taken by hedge funds? Are the majority of these funds concentrated in just a few funds and a minority spread out.

  • Who knows. Probably a sizeable amount.

    Yes, the industry is concentrated so there are a few funds with a lot of the assets out there.