It feels like every time we look at the social pages that document the lives of the rich and hedged — ie. New York Social Diary and the Bloomberg Arts section — Joseph DiMenna and his pretty wife’s face are staring back at us.The DiMenna’s are fixtures on the New York social, art and philanthropic scenes. They have two daughters and live in Manhattan.
Last year, Joe and his wife Diana pledged $5 million to the New York Historical Society; “it was the largest cash donation to any arts institution.”
So where did that $5 milllion (and the hundreds of other millions) come from?
DiMenna founded $3.5 billion hedge fund, Zweig-DiMenna Associates, with his mentor Martin Zweig in 1984, and is considered a pioneer of long/short trading.
“Joe has one of the most flexible minds on Wall Street,” a colleague told Businessweek. “He could be long a stock one day and short the next. Where people make mistakes is when it becomes a personal fight for them and they stay too long.”
DiMenna actually joined with Zweig in 1977, at Zweig’s investment firm that preceded the pair’s joint venture. As a student at Fairfield University’s Dolan School of Business, he wrote a letter to Zweig with investment ideas because he read his newsletter, The Zweig Forecast, regularly, and liked what it had to say. “Zweig hired him sight unseen as a summer employee,” Businessweek reported. “It was one of the best moves I’ve ever made,” Zweig says.
Their hedge fund Zweig-DiMenna Associates has been a long-running success, spare some damage in 2008 (but apart from a handful, who didn’t suffer causalities in 2008?)
“Joe DiMenna is the best stock-picker no one has ever heard of,” a source once told Businessweek.
In the same article, we get a sense of DiMenna’s work personality,
DiMenna’s better-known half is Martin E. Zweig, the market strategist for the hedge fund… But it is the more publicity-shy DiMenna who almost single-handedly calls the shots on trades worth tens of millions of dollars each day…
DiMenna… wears few of the badges of hedge fund managers: no Hermes ties, no French cuff shirts. There’s not a lot of hubbub in his office, either. No shouts to traders; most trades are done by E-mail.
On the list of very hedge funder-ish traits, however, DiMenna is a polo lover, and has had “numerous successes playing polo on the East End and in Palm Beach.” (He put his Southampton estate on the market last year for about $15 million and he owns not one, but two polo fields.)
He’s also a former chess champ — not uncommon in these circles.
As for art, Joe and his wife are serious collectors, favouring African tribal art, abstract expressionists, rare books and U.S. historical documents.
At the moment, the hedge fund’s biggest positions are in tech (Apple, HP, Google), financials (Prudential, Citi, JP Morgan) and mining and gold (Barrick Gold, Goldcorp, Newmont Mining, Rio Tinto) and energy (Walter, Hess).
DiMenna’s stock-picking tactic is inspired by John Maynard Keynes: “According to Keynes,” he says, “if you’re going to bet on who’s going to win in a beauty contest, don’t bet on who you think is most beautiful, but who you believe the judges think is most beautiful.”