| Paul Singer, Elliott Management Corp. (Bloomberg) |
Hedge fund managers are clearly intent on influencing who becomes president this year.
It seems that seven of the 20 largest donors to this year’s political campaigns are current or former hedge fund managers, according to a report from news website Politico. The seven individuals have so far given $38 million to various political action committees, or PACs, which mostly support individual candidates.
These are among the biggest hedge fund movers and shakers. Six of the seven have appeared on Alpha’s annual Rich List ranking of the world’s richest hedge fund managers one or more times over the past 14 years. In addition, five of the seven are members of Alpha’s Hedge Fund Hall of Fame. The significant hedge fund financing plays into the popular belief that billionaire Wall Streeters wield — or try to wield — heavy influence over the political process.
So who are these big shots, and who are they backing? Topping the hedgie donor list is Robert Mercer, the co-CEO of Renaissance Technologies, the East Setauket, New York, hedge fund firm founded by James Simons. Mercer has given $12.5 million, mostly to several super PACs supporting the Ted Cruz campaign, according to several published reports. Bizarrely, one of those PACs turned around and gave $500,000 to Carly Fiorina, according to the Washington Post. Only the little-known, Texas-based Wilks family has given more money so far this political season.
The second-biggest hedge fund–related donor is George Soros, who ranks fifth on Politico’s list overall with more than $8 million. New York–based Soros Fund Management no longer manages money for outside investors, though Soros himself was one of the world’s most famous hedge fund managers for decades. The 85-year-old Hungarian native has long been a supporter of Democratic and liberal causes. He has given all of the money this time around to pro–Hillary Clinton PACs, including $7 million to a PAC called Priorities USA Action, according to Politico. In 2004, Soros spent more than $20 million trying to prevent George Bush from getting reelected. Apparently, he is better at betting on currencies and other macro trades.
Paul Singer, founder of New York multistrategy firm Elliott Management Corp., ranks ninth overall. A major supporter of Marco Rubio, he has spent more than $5.6 million this cycle. Interestingly, Singer previously donated a sizable sum of money supporting the legalization of same-sex marriage. In fact, in 2012 he created the American Unity PAC, designed to advocate on behalf of marriage equality.
Ranking No. 10 overall is Thomas Steyer, who retired in 2012 from Farallon Capital Management, the San Francisco hedge fund firm he founded in 1986, then called HFS Partners. The environmentalist has not donated to a specific campaign directly. However, according to Politico, one of his own environment-oriented super PACs gave $500,000 to American Bridge 21st Century, which has supported Clinton’s campaign.
Steven Cohen and his wife, Alexandra, have so far donated $4 million this year. All of this money has gone to a PAC that is supporting New Jersey governor Chris Christie. Since shutting down his hedge fund firm, SAC Capital Advisors, as part of its settlement over insider trading charges, Cohen has been running his family office, Point72 Asset Management. However, under a recent settlement with federal regulators, he may be able to launch his own hedge fund firm again as soon as 2018.
Kenneth Griffin, who heads Chicago-based Citadel, has given $3.15 million to support Marco Rubio’s campaign, joining Singer. Another hedge fund manager supporting the Florida senator is Clifford Asness of Greenwich, Connecticut–based AQR Capital Management. However, he ranks only No. 71 on the donor list, having given $1 million, according to Politico.
Rounding out the top seven hedge fund donors is S. Donald Sussman, founder of Greenwich, Connecticut–based Paloma Partners. He has given $3 million, ranking 20th overall. The longtime supporter of Democrats has given money to Clinton, among others. Sussman has never appeared on the Rich List but is in the Alpha Hall of Fame.
The hedge fund community was a big supporter of Barack Obama’s initial campaign for president. But many of his supporters lost their enthusiasm by the time he ran for reelection. When the 2016 elections finally take place in November, we’ll find out which hedge fund managers can pick future presidents as well as profitable investments.
