"Most Americans don’t have any direct involvement with hedge funds — though their mutual funds, pensions or college’s endowments might invest in one. When they do hear about one, it’s often because of a scandal or other behavior that feeds the idea that hedge fund managers are billionaire pirates.
Raj Rajaratnam, founder of the Galleon Group, is serving an 11-year prison sentence after being convicted of trading on inside information. Phil Falcone is accused by the Securities and Exchange Commission of using money from his fund, Harbinger Capital, to pay his taxes.
The industry gives money to communities, funding children’s hospitals, schools and university research. But it spends richly on itself, too, with conferences that feature Maroon 5, complimentary cigar rolling, and models paid to mingle with attendees. Every once in a while, a fund manager will try to buy a sports team. Steve Cohen, head of SAC Capital, was known for larger-than-life habits, scooping up Picassos, Monets and more obscure art, once spending $8 million on a 14-foot tiger shark submerged in formaldehyde.
The average hedge fund CEO earned $1.3 million last year; the average junior portfolio manager earned about $469,000, according to estimates from the publication Institutional Investor’s Alpha. For some, the paydays are far more lucrative: Alpha estimates that David Tepper of Appaloosa Management made $2.2 billion in 2012, topping all managers."
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http://www.trivalleycentral.com/casa_grande_dispatch/national_news/hedge-funds-fall-from-grace/article_ed29b958-f6e7-11e2-a404-0019bb2963f4.html
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