Your Evening Briefing: Citadel Churns Out a Record $16 Billion

Ken Griffin’s Citadel churned out a record $16 billion in profit for clients last year, outperforming the rest of the hedge fund industry and eclipsing one of history’s most successful financial plays. The top 20 hedge fund firms collectively generated $22.4 billion in profit after fees, according to estimates by LCH Investments. Citadel’s gain was the largest annual return for a hedge fund manager ever, surpassing the $15 billion John Paulson generated in 2007 on his bet against subprime mortgages. That one was described as the “greatest trade ever” in a subsequent book of the same name. But Citadel’s performance wasn’t about one trade: Its flagship hedge fund gained 38% last year by trading everything from equities to commodities. The firm made money in each of its five core strategies, which also include fixed income and macro, quant and credit. Together, maybe they’ll be called the “greatest trades ever.”

Microsoft is investing $10 billion in OpenAI, whose artificial intelligence tool ChatGPT has lit up the internet since its introduction in November, amassing more than a million users within days and touching off a fresh debate over the role of AI in the workplace.