Monday, September 17, 2007

A.W. Jones & hedge fund history

Here's something that I've wanted to post for a while now, but somehow never got around to. 

Many of you are, I'm sure, familiar with the historical development of hedge funds and the story of how they came to be. For those who haven't heard/read the story, I thought the following might provide a useful introduction to the world's most glamorous investment vehicle, the "hedged fund"

Most media accounts of the hedge fund industry's growth typically begin with the founding of Alfred Winslow Jones' original long/short fund back in 1949. Jones reportedly had the idea for his hedged style of investment partnership while researching and writing the article, "Fashions in Forecasting", that year for Fortune magazine. 

By 1966, A.W. Jones and Co. posted returns which trounced all the leading mutual funds over a 5 and 10 year period. 

His success spawned a new group of offspring hedge funds, and led Fortune's Carol Loomis to revisit Jones' record in the seminal piece, "The Jones Nobody Keeps Up With". The rest, as they say, is history. 

Please enjoy these articles, and visit A.W. Jones' article page for more hedge fund history.