written like an advertisement . please help improve it by removing promotional content and inappropriate external links and by adding encyclopedic content written from a neutral point of view . february 2016 learn how and when to remove this template message bridgewater associates lp type limited partnership industry hedge fund founded 1975 ; 41 years ago 1975 headquarters westport connecticut u.s. area served worldwide key people ray dalio founder chairman co cio bob prince co cio greg jensen co cio david mccormick president jon rubinstein co ceo eileen murray co ceo 1 products pure alpha all weather pure alpha major markets daily observations aum us 150 billion 2016 number of employees 1 700 website bwater.com bridgewater associates is an american investment management firm founded by ray dalio in 1975 . the firm serves institutional clients including pension funds endowments foundations foreign governments and central banks . it utilizes a global macro investing style based on economic trends such as inflation currency exchange rates and u.s. gross domestic product . bridgewater associates began as an institutional investment advisory service graduated to institutional investing and pioneered the risk parity investment approach in 1996 . in 1981 the company moved its headquarters from new york city to westport connecticut and currently engages 1 200 employees . it embraces a corporate culture that encourages transparency and the elimination of the decision making hierarchy and in 2011 was the world s largest macro hedge fund company with us 122 billion in assets under management . 2 3 contents 1 history 1.1 1975 1990 consulting research money management 1.2 1991 present pure alpha all weather pure alpha major markets 2 investment philosophy 2.1 separation of alpha and beta 2.2 systematic diversification 3 products 3.1 pure alpha 3.2 all weather 3.3 pure alpha major markets 3.4 daily observations 4 corporate affairs 4.1 headquarters 4.2 employees 4.3 corporate culture 4.4 schism atop giant hedge fund 5 references 6 external links history edit the firm s history includes the pioneering of industry strategies such as currency overlay the separation of alpha and beta strategies 4 the creation of absolute return products and risk parity . 5 according to financial news the company was the fastest growing asset manager from 2000 until 2005 when it stopped accepting new accounts . 6 its assets under management have increased by 25 % each year during the last decade with employees at eleven times their year 2000 levels . 7 the company s daily observations research is reportedly read by leaders of central banks and managers of pension funds around the world . 8 1975 1990 consulting research money management edit bridgewater associates was founded by ray dalio in 1975 from an office in his manhattan apartment . at that time the business consisted exclusively of advising corporate clients and the management of domestic and international currency and interest rate risks . 9 10 the firm later changed its emphasis and began selling economic advice to governments and corporations such as nabisco and mcdonalds . 11 the company began publishing a paid subscription research report called the daily observations which inspired mcdonald s corp. and its main supplier to become clients in the early 1980s . 12 another client was banks of mid america was and its treasury department director bob prince later joined bridgewater associates as co cio . 1 in 1981 the company moved its offices from new york city to connecticut . 13 view of lake and trees surrounding the corporate headquarters in westport connecticut the company s first account was funded by a us 5 million fixed income investment through hilda ochoa brillembourg of world bank in 1987 . 14 in the mid 1980s the firm changed its business focus from currency and interest rate management to global bonds and currencies for institutional investors . 11 as a fixed income and currency adviser to institutional clients the company gained a reputation as a currency trader and a developer of techniques for overlying currencies . in 1990 it launched a hedge fund portfolio using monies from kodak and loews corporation 9 and began formally offering its currency overlay products to its clients . 15 1991 present pure alpha all weather pure alpha major markets edit bridgewater associates developed several innovative investment strategies during the 1990s such as inflation indexed bonds currency overlay emerging market debt global bonds and super long duration bonds . the firm also pioneered the separation of alpha and beta investments and developed a strategy called alpha overlay which involved a portfolio of 20 uncorrelated investments leveraged for risk or return and combined with cash or an investment market benchmark . 12 the firm launched its pure alpha fund and began to market portable alpha investment strategies in 1991 . 4 the pure alpha fund did well during the market s downturn of 2000 to 2003 and as hedge funds became more popular the company expanded its assets through its connections with various underfunded pension funds some of which were already clients . 16 in 1992 the firm introduced its global bond overlay program . 7 in 1995 company executives participated in the discussions at the u.s. treasury 17 and advised federal government on the development of inflation indexed bonds . 18 19 bridgewater launched its all weather hedge fund and pioneered the risk parity approach to portfolio management in 1996 . 20 21 the firm s assets under management grew from us 5 billion in the mid 1990s to us 38 billion by the year 2003 . 22 in june 2000 the firm was ranked as the best performing global bond manager for that year and the prior five years by pensions & investments magazine . 23 in 2002 the company was ranked by nelson information as the world s best money manager in recognition of the 16.3 % return on its international fixed income program . 24 the firm received the global investor awards for excellence global bonds award in 2003 . 22 the following year the company received the global pensions magazine currency overlay manager of the year award 25 and 2 best in class awards from the plansponsor operations survey . 26 in 2006 the company s flagship pure alpha fund began returning money to its clients in order to maintain its investment strategy and enforce its capacity limit . the firm began moving all of its clients into alternative strategies such as its pure alpha and all weather funds thereby eliminating the traditional investment approach from its portfolios . 27 that year it was honored by plansponsor magazine with the lifetime achievement award 28 and the global pensions magazine currency manager of the year award 29 and the money management letters public pension fund award for excellence and the alternatives manager of the year award . 30 by 2007 the firm s total assets under management grew to us 50 billion from us 33 billion in the year 2000 . 12 according to a 2007 article in barron s magazine nobody was better prepared for the global market crash than its clients and subscribers to its daily observations . the company began sounding alarms . . in the spring of 2007 about the dangers of excessive financial leverage . 31 the company s researchers reviewed the public accounts of most of the major financial institutions around the globe and found that estimated future losses due to bad debts totaled us 839 billion . in december these conclusions were reported to the u.s. treasury department when company founder ray dalio met with u.s. treasury secretary staff and other white house economic advisers . 32 bridgewater s pure alpha fund spared its investors from most of the stock market s meltdown in 2008 . 33 however this strategy was not successful in 2009 when economic growth responded faster than anticipated and the dow jones industrial average increased by 19 % while the company s pure alpha fund reportedly gained a mere 2 % to 4 % . 33 senator john mccain visited the firm and addressed company employees during his 2008 presidential campaign . 34 the teacher retirement system of texas trs invested in 250 million in a stake in bridgewater associates intermediate holdings lp . 35 ray dalio the company s founder began using the term d process in february 2009 to describe the deleveraging and deflationary process of the subprime mortgage industry as distinct from a recession . 31 that year the company was termed the largest hedge fund in the u.s. and it received the alternative investment news 7th annual hedge fund industry s lifetime achievement award and plansponsor s hedge fund manager of the year award . 36 37 when the u.s. gross domestic product faltered in 2010 the firm had significant gains on their investments in treasury bonds and other securities and in november founded the us 10 billion pure alpha major markets fund which brought the company s total assets under management to more than us 100 billion . 32 33 in 2011 the firm received several honors . it was ranked number one on institutional investor s world s top 100 hedge funds list . 38 it received the macro focused hedge fund firm of the year award 39 and the aicio hedge fund industry innovation award . 40 absolute return alpha ar ranked the company number one in its hedge fund report card 41 and billion dollar club categories . 42 connecticut is expected to approve a plan at the end of may 2016 which will give bridgewater associates 22 million in grants and loans in exchange for job training job creation and building renovations . the company also must agree to retain 1 402 jobs they already support in connecticut . the company could also become eligible for as much as 30 million in urban tax credits . 43 investment philosophy edit according to ray dalio bridgewater associates is a global macro firm . 44 it uses quantitative investment methods to identify new investments while avoiding unrealistic historical models . 15 its goal is to structure portfolios with uncorrelated investment returns based on risk allocations rather than asset allocations . additionally the company is reported to only accept funds from institutional clients such as pension funds foundations endowments and central banks rather than private investors . 10 14 separation of alpha and beta edit the company divides its investments into two basic categories 1 beta investments whose returns are generated through passive management and standard market risk and 2 alpha investments whose goal is to generate higher returns that are uncorrelated to the general market and are actively managed . the principle of separating alpha and beta investments was introduced by dalio in 1990 and gained the recognition of other equity managers beginning in the year 2000 . the firm is reported to be the first hedge fund manager to separate alpha and beta investment strategies and offer dedicated investment funds for each . 12 45 systematic diversification edit according to bloomberg bridgewater uses an investing system that combines traditional diversification with wager s on or against markets around the world and attempts to invest in instruments and markets that do not move in lock step with each other . 10 to guide its investment strategies the company s top executives have compiled hundreds of decision rules which are the financial corollary to the firm s employee handbook principles and these investment guidelines have been incorporated into the firm s computer s analysis . 32 products edit the firm offers three hedge funds to its clients the pure alpha fund the all weather fund and the pure alpha major markets fund . it also publishes a white paper called the daily observations which is read by investors worldwide on a subscription basis . 46 pure alpha edit bridgewater associates launched its flagship fund pure alpha in 1989 . the fund is described as a diversified alpha source that invests across a group of asset classes