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Not bad for a year's work: Hedge fund top five pocket more than $1bn each

Five of the $2trillion (£1.3trn) hedge fund industry's biggest names each took home more than $1bn last year, according to Forbes magazine's latest Rich List for the industry.

Hedge fund veterans such as David Tepper, Carl Icahn, James Simons, Steven Cohen and George Soros topped the list of big earners in 2012, a year when the average fund rose only 6 per cent. The broader US stock market, by comparison, gained about 16 per cent last year.

Mr Tepper, who runs Appaloosa Management, was the industry's top rain maker and the only the manager to pocket more than $2bn. He has been targeting US banks for the past four years, and earned $2.2bn in 2012 as his flagship fund rose by almost 30 per cent.

The corporate agitator Mr Icahn was in second place on the list, with earnings of $1.9bn.

Mr Cohen, the founder of the $15bn SAC Capital Advisors, tied with Mr Simons, the retired founder of Renaissance Technology, for third place, each taking home $1.3bn according to Forbes' calculations.

SAC Capital Advisors posted returns of about 25 per cent last year, even though a number of the hedge fund's traders are being investigated for alleged involvement in insider trading, which has prompted an exodus of outside investors.

Mr Soros, who oversees $24bn of money mostly belonging to himself and his family, earned $1.1bn in 2012, rounding out the top five hedge fund earners for 2012.