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By: Benyamin Davidsons
The NY Mets almost gave owner Steve Cohen a winning season in 2024, with a whopping nine-game winning streak, making it to the playoffs, only to lose the World Series to the Los Angeles Dodgers.
No worries though. Cohen’s real victory in 2024, came from his hedge fund— Point72 Asset Management. The hedge fund, founded in 2014 and headquartered in Stamford, CT, returned as much as $5 billion in profits to investors, allowing it to raise its fees.
As per a recent article in the Wall Street Journal, Point72’s flagship fund generated a return of about 19 percent for 2024. This means it outperformed competing funds from Citadel, Millennium Management and other multimanager firms. Per the WSJ, Citadel’s main fund made a 15.1% return in 2024, and Millennium also gained 15%, while another major competitor, Balyasny Asset Management, gained 13.6%. A composite hedge-fund index compiled by research firm Pivotal Path was up 10.8% for the year. Point72 beat its own standards too— in 2023, it had gained 10.6%. Still, the S&P 500 index had a fantastic year, boasting a total return of 25% for 2024— although the S&P is a lot more volatile than these hedge funds.
Point72, which managed $35 billion in assets in mid-2024, now has too much cash and has told its clients that it will give them back between about $3 billion to $5 billion in profits in early 2025, per sources for the WSJ. Investors were happy with the impressive returns, so much so that they agreed to a fee hike. Companies like Point72 opt not to charge a fixed management fee, but rather to pass on some or all of the costs of running their funds to investors— and this amount that can vary each year. Investors have now agreed that moving forward, Point72 clients will cover bills for certain costs that Cohen previously paid for. These changes will likely increase the investor’s expenses by a few tenths of a percentage point of fund assets, per the WSJ sources with familiarity in the matter.
For his part, Cohen, 68, has an estimated net worth of roughly $21 billion, per Forbes. He reportedly decided to stop trading his own portfolio to focus on running Point72. In October, the firm launched a stand-alone stock-picking fund dedicated to companies dealing in artificial-intelligence— a booming industry. Cohen planned to pour $150 million of his own money in to the fund, named Turion.
This fund will hold stocks for longer and allow for more volatile market swings than Point72’s main fund. Turion gained about 14 percent in the last three months of 2024.
Per the WSJ, Cohen pours much of his profits from his hedge fund business into the Mets. In 2020, he purchased the team for about $2.5 billion and has been on a steady spending spree to upgrade the team’s roster. Even after the Met’s 2024 World Series loss, Cohen signed starting pitcher Sean Manaea, 33, for a two-year $28 million contract. He also signed star outfielder Juan Soto to the team, with a 15-year, $765 million contract. This deal is the richest in sports history.
