Street Stories: Managed Futures
George Soros and the Quantum Fund Score Big Again
Financial World
The Wall Street 100
Call it the year of the hedge funds. For this elite band, it was the best year ever.
By Stephen Taub and David Carey with Andrew Osterland and David Yee
July 5, 1994
Page 33
Source: Financial World, July 5, 1994
Photograph by Apesteguy Simon
No. 1. GEORGE SOROS
Soros Fund Management
At least $1.1 billion
In 1993, George Soros managed to earn as much individually as McDonald's did with the help of 169, 600 employees. How did he do it? Fees, great performance and the power of compounding.
Let's run the numbers: To start off, the 63-year-old manages about $11 billion in several offshore funds, including the relatively well-known Quantum Fund, as well as a real estate fund. Last year each of his funds turned in spectacular performances. Leading the way: Quantum Emerging Growth, up 109% before fees, followed by Quantum and Quota, each up more than 72%. Then Soros's operation gets 15% incentive fee, which is less than the going 20% rate for hedge funds. Soros himself gets the 1% management fee on assets as of year-end and then pays all of the expenses of the firm. He also has more than $1 billion of his own capital in the funds. Add it all up, including realized gains on his own dough, and the guy made a minimum of $1.1 billion.
What does a fellow do with all this money? Soros is well-known for his generosity. NOte that nine other people on the Wall Street 100 are Soros people - he rewards those who make the biggest contributions. In addition, the Hungarian native never forgot his roots. His Jewish family had to go underground in Nazi-occupied Budapest to survive. In 1947, Soros fled Hungary and enrolled in the London School of Economics. He moved from London to New York City in 1956, the same year the Soviets quashed the Hungarian nationalist uprising. Today, he is a longtime giver to Hungarian causes, and his 33rd-floor office in midtown Manhattan is decorated with paintings by Hungarian artists. His 10-year-old foundation has already given away more than $300 million through offices in many countries of the old Soviet bloc. One recent humanitarian gift: funding the connection of Sarajevo's water supply and natural gas lines. Soros has also pledged $200 million to revamp Russia's educational system and spend $15 million to keep about 28,000 Russians working for a year.
Source: Financial World, July 5, 1994
Photograph by Arnau De Wildenberg / Gamma Liaison
Source: Financial World, July 5, 1994
Photograph by Arnau De Wildenberg / Gamma Liaison
Source: Financial World, July 5, 1994
Photograph by Apesteguy Simon
