Bridgewater expands equity ownership for employees after blowout year
[NEW YORK] Hedge fund Bridgewater Associates plans to expand its employee ownership initiative next year, which will see more than 60 per cent of staff own equity in the firm, according to an internal memo seen by Reuters.
The initiative, timed with Bridgewater’s 50th anniversary, marks a dramatic increase in employee ownership, as only about 1 per cent of employees currently own stakes in the firm, according to a source familiar with the situation.
The move was announced in an internal memo sent to employees by chief executive Nir Bar Dea, according to the source, and comes as Bridgewater’s flagship macro fund Pure Alpha is on track for its best performance since 2010.
“We are going to make more than half the company real owners of Bridgewater,” Bar Dea said in the memo. “This is something we have dreamed of for years. I know many in our community have long aspired to own a part of Bridgewater.”
Such a broad employee ownership model is typically seen at large technology companies and startups in Silicon Valley but is less common at top multi-strat funds, which typically prefer programmes encouraging employees to invest part of their compensation packages into in-house money pools that grow with a fund’s success.
Reuters reported in October that Bridgewater’s Pure Alpha fund posted returns of more than 26 per cent for the first nine months of the year, far exceeding the comparable 14 per cent gain for the S&P 500.
“I’m happy for them and I’m happy for us,” Bar Dea said in his letter, “because this creates so many builder-owners and ensures that incentives are aligned to each other and to the value of the company – that when Bridgewater does well, we all do well, with no daylight between different groups because of different instruments”.
The letter said the changes are “essential for making sure Bridgewater is set up well for the future”.
Bridgewater currently has a headcount of between 1,200 and 1,300 employees. Reuters could not determine how much of the company would be handed to employees or the terms of the offer.
Using AI for investment decisions
The firm, which had about US$92 billion of assets under management as at Sep 30, has recently bet on new strategies, including a US$5 billion fund that uses artificial intelligence (AI) to make investment decisions and an exchange-traded fund that it launched with State Street Global Advisors.
Bridgewater’s move towards the AI strategy came in 2018 after co-chief investment officer (co-CIO) Greg Jensen played a key role in hiring chief scientist Jas Sekhon.
It rolled out its Artificial Investor tool in 2024. The Artificial Investor team is currently led by Jensen, who also serves as managing CIO for the Pure Alpha fund, and by Sekhon.
Since its launch, the AIA fund has complemented the performance of Bridgewater’s other main macro funds. It posted a return of about 6.5 per cent for the first nine months of the year and has made similar gains since then, according to the source cited above.
In a recent note to clients, Jensen cautioned that the AI spending boom is entering a dangerous phase as Big Tech firms increasingly tap external investors to cover mounting costs. “Going forward, there is a reasonable probability that we will soon find ourselves in a bubble,” Jensen said in the note.
Transition under new leadership
The Westport, Connecticut-based hedge fund was founded by billionaire Ray Dalio in his two-bedroom apartment in New York in 1975. Bar Dea took over as CEO in 2022. Dalio has exited the firm, after selling his remaining stake in Bridgewater and stepping down from its board of directors this year.
Bridgewater’s transition to new leadership has been in the works since Dalio moved out of investment decision-making and into a mentorship role in 2020.
In 2023, Bar Dea unveiled a strategic overhaul by restricting new inflows into Pure Alpha and returning some assets to clients, betting that a smaller pool of money would allow the firm to better explore trading opportunities.
Bridgewater’s other top executives include co-CIO Karen Karniol-Tambour, Jensen and Bob Prince. In January, Bridgewater promoted macro trader Ben Melkman to deputy CIO, alongside David Trinh and Blake Cecil.
Global hedge funds, including stock pickers, generated returns of nearly 15 per cent in 2025 to the end of November, Reuters reported this month. REUTERS
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