Inside Chris Hohn’s Top Hedge Fund
How Chris Hohn built the world’s most profitable hedge fund
Most hedge fund managers put earthly matters above the business of the soul. But then most hedge fund managers are not like Chris Hohn. His spirituality, he believes, augments his considerable investment skills.
Hohn, 59, is perhaps the closest thing Britain has to Warren Buffett, the legendary US stockpicker, write Costas Mourselas and Amelia Pollard. His Children’s Investment Fund (TCI) has become the fifth most profitable hedge fund of all time, last year bringing in more profits after fees than any other firm.
Yet unlike its behemoth rivals Citadel and Millennium, which employ thousands of people, his fund has done this with about half a dozen elite analysts and one all-powerful portfolio manager at the helm.
His success as an investor has allowed him to turn his charitable foundation into one of the UK’s largest, giving away billions to public health, climate and children’s causes. Buffett, whom Hohn speaks to often, tells the FT his record is “exceptional”.
Hohn is driven by deep convictions: friends and former colleagues describe an investor of supreme self-confidence, a fierce activist unafraid to confront unruly executives, and a devoted philanthropist who personally gave away more than £1bn last year.
“Most of us see the world in shades of grey, where there are three or five things which are important to an investment thesis,” Rishi Sunak, the former UK prime minister who once worked at the fund, tells the FT.
“Chris has an incredible ability to think in black and white. He focuses on one, maybe two things that drive the investment thesis and then has the confidence to scale up the bet so it’s a big part of the fund.”
Hohn has built his record of success on a series of colossal multibillion-dollar bets, currently managing roughly $77bn in only 15 positions globally. Yet his convictions are increasingly being tested. A wave of advances in AI is crashing against his portfolio and challenging his biggest holdings.
It is folly to say concentrated investors are destined to fail, he says, citing his hero as an example: “The most famous concentrated investor is Warren Buffett. Anyone who knows his work knows he spoke frequently on concentrated investing. No one questions his genius.”