Median Age of Hedge Fund Founders

This is a Guest Post by David Bergstrom, he is on twitter @dburgh he is the guy behind the Build Alpha software. He has spent many years researching, building, testing, and implementing market making and trading strategies for a high frequency trading firm, a handful of CTAs, individual clients, registered money managers, and even aspiring retail traders. His website is BuildAlpha.com.

This is not a typical blog post from me; I generally write about system trading ideas, testing methods or analyzing some free strategy I’m giving away.

However, I was recently speaking to my friend about asset management and the topic of “how young is too young” came up. I was slightly curious, and as most of you know by now, I do not make decisions without looking at some data. Plus we joked that with all the 17 year old hedge fund managers out there the median age of when Hedge Fund founders begin their fund might be lower than we think.

So I put together a quick list just to get an idea of the median age of the founder at the time of starting his/her firm of some of the most prominent players in this sport. As someone who analyzes data for a living, I understand my sample is subject to selection bias and survivorship bias but this was still fun to look at.

The list is subject to selection bias because I only chose names that I have probably only heard of because of their success or because I saw them on a Forbes list. Furthermore, the list is subject to survivorship bias because the list only includes funds still in existence and not the many that have since closed.

Regardless, the list serves as a decent barometer of what success looks like in a general sense and I think it makes for an intriguing blog post nonetheless. Plus let’s face it… it is more fun to analyze the winners (especially when not putting any money behind the analysis).