The craziest of the crazy money washing round New York and London today must be in hedge funds, even despite the recent market downturn. If hedge funds were a country, they would be the eighth largest in the world. There are more than 8,000 worldwide worth an estimated $2 trillion. In April, Institutional Investor magazine noted that if Michael Dell and Bill Gates were starting out today, 'the chances are that these legendary empire builders would be running their own hedge funds, the best bet for making the biggest bucks the fastest in the post-industrial world'. It went on to observe that last year three hedge-fund titans each took home well over $1bn; the top 25 earners earned a total of more than $14bn, equivalent to the GDP of Jordan or Uruguay. Their average earnings were $570m - compared with some $30m for the highest-paid CEOs of the top 500 US corporations.
That's a hell of a lot of cash, and it makes you wonder what the men are like who earn it and what kind of lifestyles these Masters of the Universe lead. Then you get to wondering about the women. What are they like? Then you try to find them. Hedge funds, you discover, are the most misogynistic, male-dominated environments in the world - up there with Michelin-starred restaurant kitchens and, say, oil rigs. Search as hard as you like and you will only find a handful of women with their own hedge fund. And though these women are surprisingly likely to answer their phone, they are infinitely less likely to give you an interview. 'I spoke to our attorney and he advised me not to talk to the press just now,' is the phrase they will use, invariably, when they call back.
But just one is more forthcoming. Karen Finerman, of Metropolitan Capital in New York, is actually willing to crack open the secretive, testosterone-rich world of the hedge-fund manager. She has decided to go against the prevailing ethos - keep your head down, don't get a profile - and make a virtue of her pioneering status as one of the first women to run a hedge fund. She is 42, and began her hedge fund 15 years ago. It was then worth $4m; now it is worth $400m. She lives in a vast apartment on the Upper East Side, earns some $5m a year, has two sets of twins by IVF, four nannies, and a husband, Lawrence Golub, who earns a fortune in his own right from his private-equity fund. As she has four children, her looks, her marriage and more money than she could spend, she could congratulate herself on being one of the world's most successful women. Plus, unlike our beleaguered Hollywood celebrities, she doesn't need to worry about getting old or getting papped every morning.
Like the female stars of the new ABC drama Cashmere Mafia, Finerman is a cartoonish example of the zeitgeist. She holds all the trumps in the hand of life. So, does earning millions every year and being worth an estimated $100m make you happier? What kind of woman is she? Does she buy up Barneys and Tiffany's? Will her marriage survive? Can her husband's ego cope with the strain? What kind of her mother is she? Is her life a real-time version of Bonfire of the Vanities
This makes Finerman let out a husky, sexy laugh. 'Well, [when she began in the Eighties] the whole scene was kind of like Bonfire of the Vanities,' she says. 'But the amount of money that's out there now, the size of the deals - do you know what a break-up fee is? When companies sell themselves, they often, to induce bidders to come in, say: "We'll give you a break-up fee." So if someone else comes in and tops your deal with a bigger price you get to walk away with the prize of this fee. So there was a deal this year which was an extremely large deal - equity office property - and the break-up fee alone was over $500m. So they were saying, "If someone comes in and tops you, you can walk away with $500m, thanks for playing". When I started in the business, $500m was a decent-sized deal. This is a break-up fee! I mean, that's mind-boggling.'
We are sitting in neat little armchairs in a corner office at her fund on Madison Avenue. Silver-framed pictures of her two sets of twins - a boy and a girl aged 10, and a matching boy and a girl aged six - glint over her desk, some taken smiling alongside a dark, square-jawed all-American hunk: her husband, Golub. Finerman is definitely feminine, but she has a clarity and an authority - though no ego - you rarely find in a woman: you see why she has done so well. Her dark blue eyes meet you in strong, undoubting contact, her brown hair hangs over her shoulders. She is wearing no make-up and unfashionable blue jeans, but her green-and-black chiffon top is stylish and undoubtedly expensive. A stunning square, white diamond on her engagement finger catches my eye. I have to say that I really like her. She is genuine. She has a sense of humour. She is honest, not tricky; human, normal. 'My husband is a very handsome fella!' she exclaims, almost musing, or half joking, when I ask how she and Golub met.
Few people outside the financial world can even define hedge funds. Basically, they are private investment funds, primarily organised as limited partnerships - in essence, betting syndicates for the very rich. Metropolitan Capital's return has been more than respectable: an average 15 per cent return over 15 years in an industry where a lot of funds disappear in a year. When I ask why she set it up, she gives her trademark sexy laugh. 'To make money,' she says. 'When I was 15 years old I read an article about Ivan Boesky, the well-known takeover trader - turned out years later it was all on inside information! But before that came to light he was very successful, very flamboyant. And I thought, "This is what I want to do". So I'm 15 years old, I decide I'm going to Wall Street. And I apply only to the Wharton school at the University of Pennsylvania. I was obsessed with making money.' Why? 'It seemed like a good thing to have!' She laughs. Did her family think she was mad? 'I don't think so. There were five of us and they're a successful bunch. Four of us moved from California to Wall Street. The fifth, my sister Wendy, is a very successful producer in Hollywood. She did The Devil Wears Prada, won an Oscar for Forrest Gump. My brother, Mark Finerman, is very successful - he runs commercial mortgage securities at Greenwich Capital. And then I have two little sisters who are analysts at different hedge funds.'
Undoubtedly a successful bunch, though her parents, Gerald and Jane, who separated when Karen was 20, weren't on Wall Street themselves. 'My father is an orthopaedic surgeon at UCLA hospital in LA,' she says. 'My mother was a homemaker.' But she does mention that her mother always advised her to marry the successful man over the nice one. 'Because how can you be happy if you're poor?'
She graduated from Wharton in 1987 and came to Wall Street 'as I was predetermined to do' to work for the Belzberg family, the Canadian takeover raiders. Six years later she started the fund with her partner, Jeffrey Schwarz. But she points out that her career is not just about money. 'It's also about ego: about being right, being smarter than the other guy. If you're the titan of the hedge fund world and you make a billion or a billion point two, does it really matter? Is that extra point two billion changing your life? Probably not. But if your returns are better than 10 other guys who also fly their private jet out of whatever airport, that's cool. So obviously it is about the money, somewhat, but it's so much about other things.'
I say I have read that lots of men won't invest in a fund run by women. 'That's probably true,' Finerman says. I tell her a hedge-fund guy in London has told me this is because women are not logical and not good at making fast decisions. 'OK, that's idiotic,' Finerman says. 'I think, um, it's unusual for a woman to be the manager of a hedge fund, but hopefully I can do a decent job of presenting myself well, and in a way where they think, "All right! She seems intelligent and she's on top of her business and her investments". And I've got a lot of money in the game here. The fund is about $400m in assets and a big chunk of it is my partner's and my money. So hopefully I can have womanhood not be an issue in their decision to invest. And I do think there are a lot of advantages to being a woman in this business. I'd love to meet your idiot friend, because I can make quick decisions and I'm often quite logical! And I think that for me there is a humility there. A lot of men have a little bit more hubris, and I think humility is very important in being a good investor. You can say, "You know what? I had a thesis, but it's not working out the way I thought, maybe I'm just wrong, cut my losses and get out".'
Often, she is the only woman in the room at the post-talk seminars at the industrial manufacturing conferences she visits. She thinks it's another advantage. 'What guy doesn't want to have some woman hanging on their every word, especially a guy who works in one of these companies in the heartland of America, and here's a sophisticated woman who's dying to get 10 minutes alone with him and hear everything he has to say about his company?'
I ask if she buys herself treats. 'Treats ...' she echoes, blank. 'I'm less and less focused on that every year. My first year on Wall Street I got a $6,000 bonus, and I bought a stereo for $1,600, and it's the most joy I've ever got out of anything. And we have a lot of charitable things that we do, my husband and I. I'm on the board of the Michael J Fox Foundation for Parkinson's Research, which is very important to us - my mother-in-law has Parkinson's. And we are fairly active politically.' But treats? 'Well, I have four girlfriends, and we have been best of friends since elementary school and sometimes I'll do things for them. We went to London for all of our 40th birthdays and I was happy to finance that trip.' Does she buy nice clothes? 'Sometimes. I'll wear this.' She indicates her green chiffon top. Does she have time to shop? 'Not a lot.' Does someone help her? 'Sometimes. And I buy art. Not a lot. I don't have a lot of time. But that first $6,000 was so exciting for me and I probably spent it all and now I keep investing in the fund or other funds. For what end, I don't know. Because ...' She frowns. 'Yeah, I don't know! I don't want my children to ever think they don't have to work. That's clearly not the goal. And I, I suppose I didn't start on - I had a lot of advantages. I didn't come out of Wharton with any debt, I probably only had a net worth of $1,000 when I started on Wall Street, and that's just fine.'
I say I don't think there's any reason not to go into a hedge fund today. It seems like a no-brainer. 'It's not!' Finerman exclaims. 'It's hard work, you have to grow the business and run the business and it's a learning curve all the time. It's stressful,' she adds. 'You're always worried about performance. You're worried about your absolute performance, your relative performance compared to other hedge funds, and to the market. There's never a time when you don't need to worry about performance. You get no break. I have Bloomberg at home, so I'll check on what's happening overseas, and what the news is after I put the kids to bed. I eat dinner, relax for a little while, then at 10pm, 10.30pm get on Bloomberg for an hour. And there's never a break, the semester is never over, you never have a time when you're off.'
Doesn't she take a summer holiday? 'Ah!' She smiles. 'You can be out of the office. That's possible. Um. But there's never a break when they say, "Everybody stop trading, it's spring break, nothing's going to happen for two weeks" - that never happens. Companies are always being bought and sold, the markets are always moving, you have to be on top of your position. And in the US the market is never closed for more than three days. The only time the market was ever closed was 9/11. I think it may have been closed the whole week.' So it was an absolutely tragic event - but perhaps in some ways a relief? 'No. Cantor Fitzgerald is our closest broker relationship and they were the hardest hit. Our salesmen died and it was a tragic, awful time.' She pauses. 'And you knew, when the market did open, it was going to be an absolute disaster for anybody who had a long bias.'
How much control does she have? Does she feel things are uncontrollable in her world? 'You can try to control your risk,' she says. 'But everything is a calculated bet. So are you in control? 'That is an excellent question. Not really.' How would she feel if she had to lie on a beach in Ibiza for two months? 'It's unfathomable,' she says. She looks actually appalled. 'It would be panic. I can't leave everything. You know, it's a real problem. My husband likes to take seven, eight weeks of holiday a year. We've finally come to a compromise. He takes some on his own, I go with him some, he takes some of the children on some, and some on others. But, no. This thing is like some huge great bubble hanging over me the whole time.'
I now see it's true: that, while she is straightforward and likeable, partly because she is so genuine, she does have a faint weariness about her, like an underlying smeariness or tiredness, no doubt to do with the fact that she hasn't had longer than a weekend off her figures since she began her fund. I am starting to comprehend that pressure is her constant companion. And in other ways, too. When I ask what it is like to be very rich in New York she gives a wry laugh. 'There's always richer, richer, richer, richer!' It becomes clear that she has little objective sense of how much she has achieved in any area, and when I tell her she has it all - the husband, the two twins, the fortune - she looks at me as if I am talking a foreign language she doesn't understand very well.
'Um ... That's a good question,' she says, when I ask if it is hard to stay married in New York. 'We're still married, it's been 14 years. We have this big overlapping interest in business and our children, obviously. Sometimes it's hard - we both say we need a wife.' She met Golub when they were set up on a blind date by his Harvard law-school room mate. 'I thought he was a big, handsome guy who probably only got into Harvard on a basketball scholarship. Turns out he's not good at basketball, and he's very, very smart, so I had that wrong! We both started a fund. I think in a different life he would have preferred to be a scientist but recognised, "I want to have a family, how much can I make as a scientist?".' She smiles. 'And fell into Wall Street. We have four kids and he's very, very involved in their schedules and their activities.'
She had IVF. 'With my mindset now I should have known it would work out,' she says, meaning that she probably didn't really need it. Would another woman in her position have stopped working? 'Possibly,' Finerman concedes. 'A lot of women I know, when they had children, the conflict really came into play. And a lot who were lawyers were happy to leave. But for me there was never a thought that I wouldn't go back to work.'
She was at her desk until the day before the first set of twins were born and never doubted her decision to return. 'Some women are tortured by the decision. I would think, for them they need to pick the thing that makes them happy 51 per cent of the time. For me there was no 51 per cent, I was going back to work, it was 100 per cent.' She did, however, stay home for six weeks. 'I didn't like that,' she says with a smile. 'The twins were in hospital some of the time, and that made it a bit easier, because I knew they were fine. I could go home, get some sleep, and do the stuff you do when you get a new baby. I had a pile of thank-you notes to write. I always think thank-you notes cause postpartum depression or whatever you get. Every day, 50 gifts arrived! Considering I was a woman on Wall Street, people were very generous, I'd come home and there'd be 50 more gifts and I'd be like, "50 more thank-you notes!" But a life without children is unimaginable for me. My cousin says my house is like a cruise ship. There's the lido deck with food, the promenade deck with arts and crafts, the whatever deck where they're doing some movie.'
The nannies get the children up and do the school run. Finerman is at her desk by 9am, leaves at 6pm, and two nights a week takes one child to dinner alone. 'And on the nights I don't do the dinner I try not to go out during the week, that's my time with the kids; 6pm to 9pm is bedtime, stories, and then I have dinner at 9pm, often with my husband, or if he's not home, alone.'
What has the money given her? 'Empowerment. I never want to have to ask my husband for money. Never! That's incomprehensible to me. Would he have preferred that I change my name? Probably. But that's OK! And he probably assumed he would have most of the financial responsibility. Or all, maybe. But I feel we are sort of hitting our stride here, I'd like to really focus on growing this business in the next 10 to 15 years.'
She gets up, and I have an odd sense of a horse in harness as she heads out of the office, back to her computer. Did she wish she could do anything differently? 'I probably wish I could smell the roses a little bit more,' she concedes. 'I hope my kids have the joie de vivre that I feel I sometimes don't. But the goals keep moving and why is it that I never stop at the goal and say, "Wow that's great"? I never think that. All I look at is, "Gee, there's other funds that are bigger or better, how do I get to where they are?" Then the goalposts move again.'
Everything has a price, and I find myself not really envying Karen Finerman as I walk out on to the hot Manhattan street, though I admire her and like her. Certainly I feel like I have achieved nothing compared to her, but as she says, it's all relative.
Success and the city: who's who
Top UK women
Elena Ambrosiadou
With an estimated fortune of £200m, hedge-fund titan Ambrosiadou, 47, is the UK's wealthiest woman entrepreneur. Ambrosiadou, who grew up in Thessalonika, founded Ikos with husband Martin Coward in 1992. A chemical engineer by training, Ambrosiadou achieved early success at BP, becoming its youngest-ever senior international executive at 27. 'Being a business person means you understand the nature of sacrifice, integrity and balance,' she has said.
Nichola Pease
According to the Sunday Times Rich List, fund-manager Pease is the UK's 20th richest woman, two places up from the Queen, with a fortune of some £338m shared with hedge-fund tycoon husband Crispin Odey, 48. CEO of JO Hambro Capital Management, Pease, 46, has three children. In 2005-6 Odey racked up a £14.3m salary at Odey Holdings, which is worth some £260m, valuing his and Pease's stake at about £247m. Pease also has a 15 per cent stake in Hambro's £340m business.
Jayne Sutcliffe
Rated the City's second-richest woman last year after the flotation of her fund-management company Charlemagne Capital, Sutcliffe, 43, is also a mother of two. She guards her privacy, and refuses to be photographed. Her break came in 1990 when she co-founded Regent Pacific Group with Hong Kong entrepreneur Jim Mellon. Her division of the business, which specialised in investing in Eastern Europe and Russia, was spun off as Charlemagne in June 2000.
Helena Morrissey
CEO of Newton Fund Management Company, which manages in excess of £32.8bn, Morrissey, 40, has eight children. And the secret of her success? 'I have a truly marvellous husband who stays at home and helps with the children.'
Theodora Zemeck
Acknowledged as one of the best fund managers in the City, Chicago-born Zemeck, 51, is head of Fixed Income (Strategy) at New Star Asset Management, and has some 22 years of investment experience. Married with one child, she is responsible for a team running assets of £3.75bn. Of the two funds she runs at New Star, the £965m fixed-interest fund has, over the past three years, generated a sector-best total return of 20.9 per cent.
Nicola Horlick
It's 12 years since Horlick, 46, was first dubbed 'superwoman' for her ability to combine a high-profile City career with raising a large family. After proving herself working for big, muscular outfits such as Deutsche and Société Genérale, she's now CEO of her own start-up, Bramdean Asset Management. She lives in London with her second husband and five children from her first marriage. How does she do it? 'I am a capable, organised woman, who is strict about boundaries.' Horlick, who's now worth around £20m, says that in another life she would have been a radio presenter - 'maybe Woman's Hour'.
Katherine Garrett-Cox
Nicknamed 'Katherine the Great' by City admirers, Garrett-Cox, 39, has recently quit her post as chief investment officer of Morley Fund Management, where she managed £162bn worth of funds, to join the Dundee-based investment and financial services group Alliance Trust. Since accepting the job in January, she's moved to Scotland with her husband and four children.
Top US women
Susan Shaffer Solovay
Unique in the US fund-management world, Susan Shaffer Solovay heads up a 'fund of funds' that only invests in hedge funds run by women - Pomegranate Capital Management, based in New York - which, she says, 'has identified over 300 women-run funds, which manage in aggregate $55bn in capital'. Shaffer Solovay is married and has two children.
Anne Dias Griffin
A Harvard University MBA, Dias Griffin, 36 - who founded and runs the $55m Chicago-based hedge fund Aragon Global Management - is married to top US hedgehog Kenneth Griffin, who in turn heads up the city's $13.5bn Citadel Investment Group. The couple married in Dias Griffin's native France in 2003 and have proved themselves generous art benefactors, last year giving $19m to the Art Institute of Chicago - the site of one of their first dates - for a modern-art wing designed by Renzo Piano. Dias Griffin worked as an analyst and portfolio manager for the currency speculator George Soros, going on to start Aragon after Soros closed down Soros Fund Management in 2000.
Abigail Johnson
According to Forbes, Abigail Johnson is the 28th richest person in the world, whose $12.5bn fortune comes from her inheritance in, and work for, Fidelity Investments, America's largest mutual-fund company. The firm was founded by her grandfather in 1946, and Johnson, 45, who is married with two children, has spent most of her working life there. She lives with her family in Milton, Massachusetts, birthplace of former US president George H W Bush.
Edward Marriott
