Julian Robertson, the founder of Tiger Management and one of the most influential hedge fund managers of all time, has died at the age of 90.
Robertson achieved heroic status both for his record at New York-based Tiger Management during the early days of the hedge fund industry and for the dynasty of hedge fund traders known as the “Tiger cubs” that he helped launch.
“He was a legendary investor himself,” said Dixon Boardman, chief executive of Optima Asset Management, who worked with Robertson at broker Kidder, Peabody & Co about 45 years ago before Robertson founded Tiger Management. “But perhaps his greatest legacy is to have spawned so many other legendary money managers.”
Robertson died on Tuesday morning at his home in Manhattan because of cardiac complications, according to his spokesperson.
Robertson’s Tiger Management beat the US market, a notoriously difficult feat, in 14 of the years between 1980 and 2000, helped by trades such as shorting the price of copper in 1996 and betting against the Thai baht the following year.
He started Tiger with $8mn in funds, according to his spokesperson, and eventually built it into one of the world’s largest hedge funds with $21bn under management. Robertson’s investors included Stephen Schwarzman, Blackstone chief executive, who described him as “one of the few people in the hedge fund history who created a dynasty”.
In 1989, when Blackstone was then a 4-year-old firm that had just raised $100mn from Japan’s Nikko Securities, Robertson visited the company’s small office in New York, Schwarzman recalled.
“I had such a good time talking to him that I gave him all of our capital,” he told the Financial Times. “As it turned out, I had given the money to perhaps the best money manager in the world at that time.”
By the time Robertson decided to return investor capital the firm had experienced a significant decline in assets as investors withdrew and performance slumped.
Nevertheless, Tiger had delivered average annual returns of more than 25 per cent by the time it returned investors’ capital, even though Robertson lost 19 per cent in 1999 when he refused to embrace the dotcom bubble.
After that Robertson, an active philanthropist who donated more than $2bn to charity during his life, continued to play a significant role in the hedge fund industry, spawning a new generation of investors including Chase Coleman, Philippe Laffont and Lee Ainslie who went on to make billions of dollars in profits for investors.
“Julian was a legendary investor and a generous mentor,” Laffont, founder of Coatue Capital, said on Tuesday. “But, above all, he was a person of extraordinary integrity — someone who personified not just what it meant to lead a successful professional life, but who embodied the deepest love of family, a humorous disposition in friendship and a profound commitment to philanthropy.”
Ainslie, founder of Maverick Capital, on Tuesday said “Julian was a mentor and a friend to so many people who aspire to live up to his example as both a great investor and an extraordinary philanthropist.”
According to research by LCH Investments, almost 200 hedge fund groups can trace their origins back to Tiger, either because the founder worked at the firm, Robertson provided seed capital or they were a so-called “grandcub” that broke away from alumni firms.
Those who knew Robertson attribute part of his firm’s success to the influence of Dr Aaron Stern, a psychoanalyst with whom he worked closely for years and who died last year. Stern’s famous interview tests, consisting of about 450 questions, helped Robertson identify the best analysts to recruit.
Among Robertson’s more controversial Tiger cubs is Bill Hwang, the trader who presided over one of Wall Street’s most spectacular blow-ups when his firm Archegos Capital Management imploded early in 2021.
In a rare interview with the Financial Times last year, Robertson described Hwang as “a good friend” who had “made a mistake”. Hwang was arrested on US fraud charges earlier this year.
Robertson’s influence over his protégés was huge, with many adopting a similar investment style. His aim was to find the best 20 stocks to buy, and the worst 20 to bet against. While valuations were important, that could often be secondary to a company’s position in an industry or barriers to entry.
That approach helped Coleman become one of the most successful hedge fund managers of all time, before being hit hard by this year’s sell-off. In a 20th anniversary letter to investors last year, Coleman, who named his firm Tiger Global in honour of Robertson’s influence, described his former boss as a “world-class mentor” and said that many “Julian-isms” were still used at his firm.
“You took a chance on us early on, embraced us as part of the Tiger family and supported us continuously along the way,” Coleman wrote. “You showed us how the best investors think and invest.”