Hedge Fund Winton Earned 351 Million Pounds of Fees in 2011
Winton Capital Management LLC, the $28 billion hedge fund founded by David Harding, earned 351 million pounds ($564 million) of fees last year after its assets under management surged 65 percent.
The revenue compared with 282 million pounds of fees in 2010, London-based Winton said in a U.K. Companies House filing published yesterday. Winton’s after-tax profit rose 23 percent to 162 million pounds in 2011, the filing said.
Winton makes money by charging clients fees for managing assets and for any investment gains in its hedge funds. The firm was one of the world’s most successful hedge funds at raising money from investors in 2011, as assets under management soared to $28 billion from $17 billion a year earlier, according to the filing.
Winton invests in futures markets tied to commodities, currencies and stocks, relying on computer algorithms to decide when to buy and sell. The firm, the fourth-biggest hedge fund in Europe by assets, employs about 100 scientific researchers, including Harding, a Cambridge University-educated physicist.
The Winton Futures Fund Ltd., the firm’s main hedge fund, declined about 3.5 percent through September of this year after gaining 6.3 percent in 2011.
So-called systematic funds that also rely on algorithms have struggled over the past two years during Europe’s sovereign debt crisis, as market sentiment swings from pessimism to optimism based on announcements from central banks and politicians, making it difficult to follow trends. The Newedge CTA Index, which tracks some of the largest trend-following hedge funds, rose 0.1 percent through September after falling 4.5 percent in 2011.
Harding, 51, earned 87 million pounds in 2011, paying 34 million pounds in taxes to the U.K. government, according to an article published Sept. 30 by the Sunday Times. He started Winton in 1997 after helping design an earlier systematic- trading system that was purchased by London-based Man Group Plc (EMG), the world’s biggest publicly-traded hedge fund.
Winton spokesman Robin Eggar declined to comment on Harding’s 2011 earnings. While Winton generates its revenue overseas, the company and its employees paid more than 520 million pounds of taxes in the U.K. for the six years ended in 2011, Eggar said.
BlueCrest Capital Management LLP, Europe’s third-biggest hedge fund with $32 billion of assets, made 502 million pounds of fees in 2011, according to a September Companies House filing. Michael Platt, BlueCrest’s founder, relocated to Geneva from London in 2010 after the U.K. imposed higher taxes on its wealthiest citizens.
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