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Hedge fund giants Citadel and Millennium have been outshone by smaller rivals so far this year, as the firms were stung by the market volatility unleashed by Donald Trump’s trade war.
Citadel’s flagship Wellington fund gained 2.5 per cent in the first half of 2025 while Millennium gained 2.2, according to people familiar with the matter. Balyasny and ExodusPoint were up 7.3 per cent and 9.3 per cent, respectively, according to people who have seen the figures.
Ken Griffin’s Citadel and Izzy Englander’s Millennium, which manage about $66bn and $75bn respectively, are the dominant players among so-called multi-manager funds, a sector that has sucked in billions of dollars from the world’s largest investors.
Multi-manager firms, which also include $25bn Balyasny and $11bn ExodusPoint, have legions of trading teams known as “pods”, which trade a variety of strategies in asset classes including equities, fixed income and commodities. They borrow large sums from banks to juice returns and adhere to strict risk management to control losses, making them attractive to big investors such as pension funds that desire stable returns.
As pioneers of the model, Millennium and Citadel have been catapulted to the very top of the hedge fund industry over the past decade.
Multi-managers are fuelled by so-called “pass-through” fees, which involve charging all expenses, including office rents, technology and data, bonuses and client entertainment, directly to investors. This is a departure from the typical hedge fund model, which historically charged a 2 per cent management fee on assets.
Citadel was wrongfooted by Trump’s tariff policies earlier this year, with Griffin telling The Economist in May that the firm had to “tear apart and re-examine the portfolio . . . and ask yourself in what ways we have positioned or mis-positioned ourselves against the reality that the odds of a recession have gone higher”.
Last year, Citadel and Millennium eclipsed most rivals as they delivered 15 per cent to investors. Citadel’s annualised net return since the firm was founded 35 years ago is roughly 19.2 per cent.
Griffin, a major Republican donor, has become one of Trump’s most outspoken critics, saying last year that the president’s tariff plans would put the US “on a slippery slope to crony capitalism”.
Meanwhile, the flagship Apex strategy of billionaire Cliff Asness’s quant fund AQR was up 11.4 per cent in the first half of the year, according to a person familiar with the numbers. Bridgewater Associates, the macro hedge fund founded by billionaire Ray Dalio, also had a strong first half of the year with its Pure Alpha fund returning 17 per cent.
