As we reported in Friday's Behind The News, the Absolute Return magazine published its 11th annual list of the 25 Highest Paid Hedge Fund Managers.  For 2011, Bridgewater’s Ray Dalio was the Richest of the Rich.  In this posting, we provide profiles for Mr. Dalio and the next 5 runners-up. #1 - Raymond Dalio, BRIDGEWATER ASSOCIATES.  [$3.9 billion] What do you get when the founder of the world’s largest hedge fund firm racks up one of the year’s best returns?  The highest-earning hedge fund manager.  Ray Dalio’s Bridgewater Associates, which began 2011 with nearly $59 billion in hedge fund assets and finished with about $70 billion - for a total $120 billion in assets - posted a 16.05% return for Pure Alpha, its largest hedge fund.  Thanks to gains on his substantial personal capital in Bridgewater’s funds and his share of the hefty fees, Mr. Dalio, 63, earned about $3.9 billion last year.  That’s nearly 10 times the $400 million he made in 2009, when Pure Alpha was up just 2%. In 2011, Westport, CT-based Bridgewater was said to benefit mostly from investments in U.S. Treasuries;  it was shrewdly bearish on the U.S. economy early in the year and participated in the subsequent rally in Treasury prices, German bonds and the Japanese yen.  This year Bridgewater is looking for gold to rise, figuring several countries will intentionally inflate their money supplies to help reduce debt.  Bridgewater is also looking for strength in emerging-markets currencies and lower yields in what it deems to be high-quality government bond markets, according to reports. Dalio attributes Bridgewater’s controversial corporate culture, which encourages blunt honesty among all employees, for a big part of the firm’s success, even though it has received a fair amount of criticism. Bridgewater has made about $50 billion for its investors since Dalio founded it in 1975 from his 2-bedroom New York apartment. #2 - Carl Icahn, ICAHN CAPITAL MANAGEMENT.  [$2.5 billion] Carl Icahn’s activism paid off big-time in 2011.  While more than half of all hedge funds were in the red, the 76-year-old onetime corporate raider racked up a 34.5% gross return.  As a result, he personally earned $2.5 billion even though he returned all money to his outside investors last April.  Mr. Icahn generated nearly half of his gains in the 4th quarter, led by natural gas company El Paso Corp., which agreed to be acquired by Kinder Morgan some 3 months after Mr. Icahn began building his position.  His other big winners: biotech company Biogen Idec, communications companies Motorola Mobility Holdings and Motorola Solutions, and Chesapeake Energy Corp. In a recent regulatory filing, Icahn calculated that over the past few years his actions have boosted aggregate market value by more than $55 billion for shareholders at well over a dozen companies he’s targeted.  Last year, when he announced his plan to return all outside investor money by April 2011, Icahn stressed that he was not predicting a big drop in the market.  However, he did not want to experience another year like 2008, when his fund lost 35% and he did not restrict investors from pulling their money. "Given the rapid market run-up over the past 2 years and our ongoing concerns about the economic outlook, and recent political tensions in the Middle East, I do not wish to be responsible to limited partners through another possible market crisis," he wrote. At the time, fee-paying assets represented one quarter of the roughly $7 billion Icahn managed in the funds. #3 - James Simons, RENAISSANCE TECHNOLOGIES CORP.  [$2.1 billion] Talk about rising from the dead.  In 2009 the Renaissance Institutional Equities Fund had lost money for 2 straight years, and the co-CEOs of Renaissance Technologies Corp., which manages the fund, threatened to shut it down.  Wisely, they didn’t.  Last year RIEF surged about 34%.  The huge gains in RIEF and the firm’s Medallion funds enabled Renaissance founder James Simons, 73, to rake in more than $2 billion last year, mostly from returns on his own money, even though he officially retired in 2010.  Simons, an award-winning mathematician, still serves as non-executive chairman of the $20 billion East Setauket, NY-based hedge fund firm. RIEF pursues a net-long investment strategy, going roughly 150% long and 50% short, trading U.S. and non-U.S. equity securities listed on U.S. exchanges.  Renaissance’s legendary Medallion strategy, which was up about 35% last year, employs a short-term quantitative trading strategy and has been closed to outside investors for many years. On March 1, the firm launched a new vehicle, the Renaissance Institutional Diversified Alpha Fund, which will trade stocks listed on U.S. exchanges as well as futures and forwards.  Renaissance also has a little-known fund of funds called Kaleidoscope that invests in the firm’s other funds. A noted philanthropist, Simons, along with his wife, Marilyn, donated $150 million late last year to Stony Brook University - one of the largest gifts ever made to any institution of public higher education.  Simons is a former chairman of the school’s math department; his wife, who has a Ph.D. economics, is an alumna of the university. #4 Kenneth Griffin, CITADEL.  [$700 million] It took nearly 3 years, but Citadel founder Kenneth Griffin can finally say that he and his funds are above water.  The firm’s multi-strategy funds Kensington Global Strategies and Wellington - which account for the bulk of the Chicago-based firm’s $11 billion in assets - netted gains of more than 20% in 2011, overcoming the 55% they lost in 2008.  (The fact that the funds are back above their high-water mark means that Citadel can start charging performance fees again.) This strong showing placed Griffin, 43, among the top performers as well as the highest earners last year.  Although Kensington and Wellington were profitable across all strategies, they were said to have done especially well in equities, energy and convertibles. In addition, the Citadel Global Equities Fund was up more than 21% in 2011.  In a recent letter to clients, Griffin boasted that his Global Equities team had posted its 10th consecutive year of profitability. Mr. Griffin famously launched his career trading convertible bonds from his dorm room in Cabot House at Harvard College, graduating in 1989 with a BA in economics.  He launched Citadel the following year.  Mr. Griffin and his wife, Anne Dias-Griffin, who runs hedge fund Aragon Global Management, are ramping up their spending on political candidates and the Republican Party.  In the 3rd quarter of 2011 alone, they gave $300,000 to American Crossroads, a political action committee that seeks to defeat President Obama. #5 - Steven Cohen, SAC CAPITAL ADVISORS.  [$585 million] SAC Capital Advisors founder Steven Cohen, 55, is known as the consummate trader, delivering double-digit returns for the better part of 2 decades.  Although last year’s 8% net return by SAC’s flagship multi-strategy fund was among Cohen’s worst annual results, apart from its 19% loss in 2008, the fund’s gross return of 16% was easily among the best hedge fund performances of 2011.  The fund, which charges a whopping 50% performance fee, did especially well in discretionary long-short equity, earning most of its gains from the energy, retail and technology sectors. Mr. Cohen, whose firm operates out of plush offices in Stamford, CT, decorated with works from his vast collection of contemporary art, has a proclivity for making headlines. He recently lost his bid to buy the Los Angeles Dodgers baseball team and is rumored to be plunking down $20 million to purchase a small piece of the New York Mets, as a hedge in case he loses out on the Dodgers. But Cohen garnered embarrassing publicity from the federal government’s wide-ranging, ongoing investigation of insider trading activities:  No fewer than 7 former SAC employees ran afoul of regulators - 2 of whom pled guilty to criminal charges, in part for actions that took place while they worked at SAC;  the rest settled civil claims made by the SEC. Earlier this year, 2 other former SAC employees were arrested - Anthony Chiasson, who co-founded Level Global in 2003 with SAC alum David Ganek - and Jon Horvath of SAC affiliate Sigma Capital Management.  Neither Cohen nor SAC has been accused of any wrongdoing. #6 - Chase Coleman, TIGER GLOBAL MANAGEMENT.  [$550 MILLION] He may come from old money, but in 2011 few managers were better at making new money than Chase Coleman. His NY-based hedge fund Tiger Global delivered a 45% net return, helping Coleman make his 2nd appearance on the Rich List after a 3-year absence. Mr. Coleman, who manages about $6 billion in 3 hedge funds and an additional $4 billion in 6 private equity funds, made a big portion of his profits last year from start-up and fledgling Internet companies.  At year-end the largest public holding in his hedge fund was Russian search engine company Yandex, which accounted for more than $1 billion of Tiger Global’s $5.7 billion long stock portfolio. He also held large positions in Priceline.com, Google and Baidu. For further details, go to: [CNBC Slideshow, 3/30/12] and [Absolute Return+Alpha, April 2012] -- a trial subscription is required to read about the top 25 managers].