A little-known hedge-fund manager's huge bet on inflation earned him $859 million and propelled him into the top 10 list

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A little-known hedge-fund manager's huge bet on inflation earned him $859 million and propelled him into the top 10 list
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  • The manager of a little-known hedge fund was the 6th highest paid manager last year, per Bloomberg.
  • Said Haidar made a huge leveraged bet on interest rates rising last year, and took home $859 million.
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The manager of a little-known hedge fund took home $859 million last year, after a huge bet on inflation paid off and catapulted him into Bloomberg's top 10 earners list.

Haidar Capital Management delivered a 193% return last year to investors after its founder Said Haidar took a punt that US interest rates would rise by at least 400 basis points, Bloomberg reported, based on its own analysis.

But while the hedge fund reported a $63 billion in assets under management to start 2022, it actually oversaw just $1.2 billion. That added up to a highly leveraged bet that markets would need to price in rapid rate hikes — a position that saw ups and downs through the year.

At the start of 2022, Haidar warned the fund's investors that inflation risks weren't priced into markets and central bank tightening was likely. He was right, getting ahead of a shift in market sentiment and the Russian invasion of Ukraine, which added to price pressures.

The Federal Reserve raised interest rates from about zero in March last year to around 4.75% currently, as they battled inflation at historic highs. While the US headline rate has fallen from last year's June peak of 9.1% to about 6% in January, producer prices rose 0.7% last month in a sign pressures haven't all abated yet.

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The jump in prices last year means the hedge fund, which had positioned itself to profit from the rises, was able to benefit reap huge returns from its bet.

With that, Haidar became the sixth-highest-paid hedge fund manager last year, per Bloomberg. His $859 million total was split between a $645 million gain on personal investment and a $314 million share of fund performance fees.

By comparison, David Siegel — whose Two Sigma has $58 billion in assets under management — raked in $411 million. Meanwhile, Elliott Management's Peter Singer brought home $317 million, with his hedge fund managing $56 billion in assets.

Citadel's Ken Griffin was the highest paid fund manager last year, bringing in $4.1 billion, while Point72's Steve Cohen came in second with a $1.9 billion windfall.

Bloomberg's analysis was based on a collection of publicly available figures for hedge fund managers, as well as estimates of management and performance fees where data wasn't available.

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