The Wall Street Journal has put together the best history of hedge funds I have found so far. They start with the legendary Fortune Magazine editor, Winslow Jones, who created the first fund out of a shabby office on Broadway in 1948, and generated monster returns over the next 20 years. I learned for the first time that the industry standard 20% performance bonus was borrowed from ancient Phoenician sea captains who kept a fifth of the profits from successful voyages. Jones must have had an historical bent. They cover the second generation titans, George Soros, Julian Robertson, and Michael Steinhardt, who made their debut in the sixties. I count myself among the third generation along with Paul Tudor Jones and Louis Bacon, who launched funds in the late eighties, when there were still fewer than 200 funds and $25 million was still considered a lot of money. The really big money showed up in the nineties when the pension funds found them. The Journal then navigates us through the big crisis that followed, including Long Term Capital, Amaranth, and Lehman Brothers. It also correctly points out that the industry’s avoidance of ratings agencies kept most funds out of hot water during the financial crisis. Today there are over 10,000 hedge funds, thought to manage some $2.9 trillion which dominate all financial markets. To read the well researched article in full, please click here.