Cliff Asness

Clifford Asness
Born	Clifford Scott Asness 17 10, 1966
Birthplace	New York City, New York, U.S.
Nationality	American
Occupation	Hedge fund manager, financial theorist
Title	Co-founder, Managing Principal, and Chief Investment Officer
Employer	AQR Capital Management
Known for	Co-founding AQR Capital Management; quantitative investing research
Education	PhD, University of Chicago
Children	4

Clifford Scott Asness (born October 17, 1966) is an American hedge fund manager, financial theorist, and the co-founder, managing principal, and chief investment officer of AQR Capital Management, one of the largest quantitative investment firms in the world. Trained under Nobel laureate Eugene Fama at the University of Chicago, Asness built his career at the intersection of academic finance and practical money management, applying systematic, factor-based strategies to global markets. He founded AQR in 1998 after an early career at Goldman Sachs, where he helped establish the firm's quantitative research group. Over the following decades, Asness became one of the most prominent voices in the hedge fund industry, known both for his rigorous approach to quantitative investing and for his outspoken commentary on markets, public policy, and economic issues. A prolific writer, he has published extensively in academic journals such as the Financial Analysts Journal and the Journal of Portfolio Management, and has been a frequent commentator on topics ranging from value investing and market efficiency to the behavioral dimensions of asset pricing. His public writings and media appearances have made him one of the most recognized figures in modern quantitative finance.

Early Life

Clifford Scott Asness was born on October 17, 1966, in New York City, New York. He grew up in the New York metropolitan area. Details about his parents and upbringing are not extensively documented in public sources, though his later identification as Jewish has been noted in political reporting contexts.

Asness developed an early interest in mathematics and finance, which would shape his educational trajectory and eventual career. His intellectual orientation toward quantitative reasoning and empirical analysis became a defining feature of both his academic work and his professional pursuits.

Education

Asness attended the University of Pennsylvania, where he earned a Bachelor of Science degree. He subsequently enrolled at the University of Chicago Booth School of Business, one of the leading centers of financial economics research, where he completed both a Master of Business Administration (MBA) and a Doctor of Philosophy (PhD) in finance.

At Chicago, Asness studied under Eugene Fama, the economist who would later receive the Nobel Memorial Prize in Economic Sciences in 2013 for his work on asset pricing and the efficient-market hypothesis. Fama served as Asness's doctoral dissertation adviser, and the intellectual framework of the Chicago school of economics—with its emphasis on empirical rigor, market efficiency, and systematic risk factors—profoundly influenced Asness's approach to investing. His doctoral research focused on momentum strategies in equity markets, a topic that would remain central to his career.

Career

Goldman Sachs

After completing his doctoral work at the University of Chicago, Asness joined Goldman Sachs, where he became a managing director and the director of quantitative research within the asset management division. At Goldman, he helped develop and manage systematic, model-driven investment strategies, applying the academic research on value, momentum, and other factors to real-world portfolio construction. His work at Goldman Sachs represented an early and influential example of bringing rigorous quantitative academic finance into the institutional money management world.

Founding of AQR Capital Management

In 1998, Asness left Goldman Sachs to co-found AQR Capital Management, based in Greenwich, Connecticut. The firm's name stands for "Applied Quantitative Research," reflecting its mission of applying academic financial research to practical investment management. AQR was established as a quantitative investment firm that would employ systematic strategies across multiple asset classes, drawing heavily on factor-based investing principles such as value, momentum, carry, and defensive strategies.

Under Asness's leadership as chief investment officer, AQR grew into one of the largest hedge fund and alternative investment managers in the world, managing tens of billions of dollars in assets. The firm offers a range of products spanning hedge fund strategies, long-only equity strategies, and alternative risk premia funds. AQR's investment philosophy centers on the idea that well-documented, academically grounded factors can be exploited systematically across markets over time, though Asness has frequently acknowledged the difficulty of maintaining discipline during periods when such strategies underperform.

The firm experienced significant challenges during the 2007–2008 financial crisis, as many quantitative strategies suffered during the so-called "quant quake" of August 2007, when numerous quantitative hedge funds experienced sudden, correlated losses. AQR also navigated the broader market turmoil of 2008 and 2009. The firm subsequently recovered and continued to grow in the following years.

Academic and Industry Research

Throughout his career, Asness has maintained a prolific output of academic and practitioner-oriented research, publishing papers in leading financial journals. His work has covered a wide range of topics in asset pricing and portfolio management, including value and momentum investing, the equity risk premium, leverage aversion, and the relationship between dividends, earnings growth, and stock returns.

One of Asness's notable academic contributions was a 2003 paper in the Financial Analysts Journal titled "Surprise! Higher Dividends = Higher Earnings Growth," which challenged conventional assumptions about the relationship between corporate dividend policy and future earnings growth. The paper argued that, contrary to the popular view that firms retaining more earnings would grow faster, higher dividend payout ratios were historically associated with higher subsequent earnings growth.

Asness has also written on the topic of market timing. In a 2025 piece revisiting a paper he originally submitted to the Financial Analysts Journal more than 25 years earlier, he addressed the common argument against market timing based on the hypothetical cost of missing the market's best days. He argued that this framing is misleading, as the best and worst days tend to cluster together, and that the analysis does not constitute a valid case against disciplined, systematic approaches to asset allocation.

In 2025, AQR published research on buffer funds in the Journal of Portfolio Management, examining the trade-offs inherent in structured investment products and arguing that such products do not offer genuine free lunches for investors.

In a series of interviews and commentaries in late 2025 and early 2026, Asness discussed the outlook for factor investing, the role of artificial intelligence in investment management, and his view that markets have become increasingly volatile and prone to behavioral extremes. In a December 2025 interview, he stated that "markets have gotten crazier," emphasizing the importance of investor discipline during periods of heightened market dispersion and irrationality. In an interview on the Capitalism and Freedom Podcast in October 2025, he described markets as "voting mechanisms," tracing a lifetime of market thinking shaped by data and humility.

In a February 2026 discussion, Asness addressed the outlook for quantitative investing, including factors, AI, and valuation risk, reiterating his view that markets rarely reward certainty for long and that systematic approaches remain the most defensible framework for long-term investing.

In a January 2026 interview, he emphasized the importance of repeating rational strategies even when they are uncomfortable, articulating a long-held view that emotional discipline is as important as analytical rigor in investment management.

Views on the Investment Industry

Asness has been a frequent critic of what he considers excessive fees in the investment management industry, particularly the practice of charging hedge fund–level fees for strategies that primarily deliver market beta rather than genuine alpha. In a July 2025 interview with Morningstar, he stated: "The problem was never beta. The problem was paying alpha fees for beta." In the same interview, he discussed alternative strategies, private markets, tariffs, and the emerging role of artificial intelligence in investing.

He has also spoken publicly about the potential role of quantitative methods beyond traditional financial markets. In November 2025, Bloomberg reported that Asness said AQR was exploring a push into sports betting, applying the firm's quantitative and analytical capabilities to a new domain.

Stock Options and Corporate Governance

Asness has written and spoken about corporate governance topics, including the accounting treatment of stock options. In a 2004 commentary, he argued that the failure to properly expense stock options on corporate income statements distorted financial reporting and could hurt U.S. competitiveness, a view he articulated in the context of broader debates about accounting standards and corporate transparency.

Personal Life

Asness married Laurel Fraser in 1999. The wedding was reported in The New York Times. The couple has four children.

Asness has been publicly identified as Jewish and as a Republican who supports gay rights. In 2011, the Jewish Telegraphic Agency profiled him as a Jewish Republican who was outspoken in his support for same-sex marriage. In 2013, he was among 131 prominent Republicans who signed an amicus brief to the Supreme Court of the United States in support of same-sex marriage.

Public Commentary and Political Views

Asness has been an outspoken commentator on economic and political issues, often writing and speaking from a free-market, libertarian-leaning perspective. During the 2008–2009 financial crisis, he attracted attention for his forceful criticism of government intervention in financial markets and what he perceived as populist attacks on the financial industry.

In September 2008, during the unfolding of the financial crisis, a New York Times blog post profiled Asness under the headline "Cliff Asness Is Mad as Hell," documenting his frustration with market conditions and government policy responses.

In May 2009, Asness published an essay on Forbes.com criticizing President Barack Obama's rhetoric toward hedge fund managers, particularly in the context of the Chrysler bankruptcy proceedings, where the president had publicly criticized holdout creditors. Asness argued that the administration's approach was an attack on the rule of law and contract rights. His public stance during this period was further documented by New York Magazine, which described his role as a prominent hedge fund critic of the Obama administration's financial policies. ABC News also covered his public criticism of the president during this period.

Asness has also written about taxation of hedge fund income. In a 2010 Bloomberg interview, he discussed the potential impact of proposed tax increases on hedge funds, including changes to the treatment of carried interest.

He has maintained a blog and published essays on economic and political topics, including work posted on personal websites such as "Stumbling on Truth."

Legacy

Clifford Asness occupies a distinctive position in modern finance as one of the figures most responsible for bridging the gap between academic financial research and institutional investment practice. His doctoral work under Eugene Fama at the University of Chicago placed him in the lineage of the efficient-market hypothesis and the Fama-French factor model tradition, while his career at Goldman Sachs and the subsequent founding of AQR demonstrated that academic insights about value, momentum, and other systematic factors could be applied at scale in real portfolio management.

AQR Capital Management, under Asness's leadership, became one of the most influential quantitative investment firms in the world, managing assets across a broad range of strategies and serving as a major disseminator of financial research to both institutional and individual investors. The firm's research papers, many authored or co-authored by Asness, have contributed to public understanding of topics such as factor investing, the limits of diversification, the risks of leverage, and the behavioral pitfalls that affect both individual and institutional investors.

Asness's willingness to engage publicly on political and economic questions—including his support for same-sex marriage as a Republican, his critiques of government financial policy, and his commentary on the investment management industry's fee structures—has made him one of the more prominent public intellectuals within the hedge fund world. His long-running argument that investors too often pay active management fees for passive market exposure has influenced broader industry discussions about fees, transparency, and the distinction between alpha and beta.

His more recent explorations, including the potential application of quantitative methods to sports betting, suggest a continuing interest in expanding the reach of systematic, data-driven approaches beyond traditional financial markets.