Meet Alister Hibbert, one of BlackRock Inc.’s best kept secrets.
He’s the money manager whose hedge fund has enriched the firm, its clients and himself with a near 370% gain over the past decade. Hibbert’s name is rarely mentioned within the walls of the world’s largest asset management firm, and many employees don’t even know who he is. That’s even after his fund single-handedly earned almost half of BlackRock’s record performance fees last year, according to Bloomberg calculations.
More than half a dozen investors and people who know him say London-based Hibbert, 51, has often been the firm’s highest paid employee globally. Last year alone, he earned a nine-figure sum more than triple the size of CEO Larry Fink’s $30 million payout, according to Bloomberg estimates and the people, who asked not to be identified because the details are private.
Hibbert runs the BlackRock Strategic Equity Hedge Fund, which has swelled to almost $9 billion from betting on and against U.S. and European companies. Since launching, it has more than tripled the gains of other long-short equity hedge funds, many of which now face an existential crisis as they trail well behind the longest bull market in history. It's a rare glimpse into the key roles some humans still play at a firm whose prescient move into index-tracking investments more than a decade ago has powered its rise into a behemoth overseeing almost $10 trillion.
BlackRock and Hibbert declined to comment. Details of his earnings, investing style, track record and history are based on his newsletters, a fund presentation sent to clients and interviews with people who know him or invest with him.
The pay gap between Hibbert and his powerful boss shows the might of hedge fund compensation in a mutual fund world: he earned BlackRock’s top payout despite managing a sliver of its assets. While Fink is still one of the highest paid CEOs in asset management and owns a stake in the firm that has made him a billionaire, hedge fund managers have traditionally ruled Wall Street when it comes to payouts. The top 15 hedge fund earners last year made an estimated $23.2 billion between them, according to a Bloomberg-compiled annual list.
The divide in compensation also demonstrates that BlackRock, known for a laser focus on costs and margins, understands that to stop top talent from jumping to rival managers such as Citadel or Point72 Asset Management—or starting funds themselves—it has to keep up with industry standards. Losing a fee machine like Hibbert could cripple the firm's effort to grow its hedge fund business.
Hibbert recently stepped down from managing two other large BlackRock money pools to focus on his far more lucrative hedge fund. Since arriving at the firm in 2008, he’d overseen the European Dynamic and Continental European Flexible funds, whose combined assets have since ballooned to more than $18 billion. It was in 2011 that he started the more sophisticated strategy with just $13 million, and after successful bets including long-time positions in Facebook Inc. and Alphabet Inc., it’s quietly become one of BlackRock’s biggest cash machines.
This year, Hibbert has barely made money after inflation fears weighed on his growth investments. He was late to respond last November when rising global vaccine levels sparked a selloff among firms perceived at risk as economies emerged from lockdowns. He was also caught out earlier this year by a short bet on Wm Morrison Supermarkets Plc, which surged amid a private equity bidding war. Clients say that Hibbert still believes that inflation will be transitory, even as growth stocks remain under pressure.
“Grandiose statements about investing in inflationary environments, which trail off far before detailing any practical investment conclusions save for the tiresome call to sell growth stocks, do not impress us at all,” he wrote to clients in July.