Made money in the financial crisis year
Institutional Investor and The Hedge Fund Journal report that the Master Fund made about +20.4% in 2008, while the average hedge fund lost about 19%
Famous Traders · Rates & Macro
Alan Howard
Alan Howard / Co-founder of Brevan Howard and Interest Rate Trader
A former chemical engineer who went on to trade bonds, then built one of Europe’s largest Macro funds. He made money in the 2008 crisis year, saw assets shrink by more than 80%, then came back in 2020. On this page you can move the yield curve, compare options with buying outright, and stress-test a portfolio against past crises.
CERTIFICATE · No. 2003Brevan HowardGLOBAL MACRO · RATES · LONDON 2002
AH
YIELD CURVE 2021→22
- 2002Co-founded Brevan Howard
- 2008Master Fund about +20.4%
- 2014First losing year −0.82%
- 2020AH Master Fund over +100%
Illustration: designed as a bond certificate, because he mainly traded bond markets. No openly licensed photo was found
Born (approx.)1963
Brevan Howard2002
Master Fund in 2008+20.4%
Peak assets, 2013 (approx.)$40B
2008 · crisis year+20.4%Master Fund performance while the average hedge fund lost about 19%
2020 · AH Master Fund>100%The fund Howard trades himself, during the COVID turmoil in rate markets
2013 → 2018$40B → $6.3BFirm-wide assets from peak to trough, before recovering to about $30B in 2022
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ProfileQuick facts
NameAlan Howard
BornAround 1963–1964 in England. Sources disagree on the year
EducationChemical engineering at Imperial College London, as reported by Institutional Investor
Before his fundStarted at Salomon Brothers in the eurobond market before moving to Credit Suisse First Boston, where he headed a trading team
His own fundCo-founded Brevan Howard in 2002 with four former Credit Suisse colleagues. The main Master Fund launched in April 2003
Best known forIn 2008 the Master Fund made about +20.4% while the average hedge fund lost about 19%, and in 2020 his own AH Master Fund made over 100%
StyleGlobal Macro focused on interest rate and bond markets, betting on central bank policy and using options to limit downside risk
Current roleHanded the CEO role to Aron Landy in 2019 but remains the firm’s principal money manager
02
From bonds to BrevanFrom chemical engineer to the rates desk and a fund of his own
Howard studied chemical engineering at Imperial College London, then started his finance career at Salomon Brothers in the eurobond market before moving to Credit Suisse First Boston, where he headed a trading team and gathered talented interest rate derivatives traders around him
In 2002 he and four colleagues left to found Brevan Howard in London, and the main fund began trading in 2003. The firm’s success is tied to the interest rate cycle: when central banks move sharply, it makes money; when rates are pinned still, money flows out. Tap each year on the chart to see the story
ASSETS UNDER MANAGEMENT · $ BILLION · APPROX.Firm-wide assets rise and fall with the interest rate cycle
Howard and four colleagues from Credit Suisse, Chris Rokos, Jean-Philippe Blochet, James Vernon and Trifon Natsis, founded Brevan Howard. The firm’s name was formed by combining the founders’ names
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The points on the chart are approximate firm-wide assets from media reports. Each source measured in a different month, so use them to see the direction, not as official figures. Years without a figure show events only
A principle the firm described to The Hedge Fund JournalHedge whenever you can, not only when you have to
Paraphrased, not a direct quote, and a description from the firm, not Howard’s own words
03
The yield curveLab: move the yield curve and see who wins and who loses
The yield curve shows the interest rates on government bonds of each maturity. The short end moves with the policy rate; the long end moves with views on inflation and the economy. Traders like Howard don’t just guess whether rates go up or down, but how the shape of the curve will change. Pick a real event or move it yourself
Shape of the curve—
10-year − 2-year spread—
Holding $1M of 2-year bonds—
Holding $1M of 10-year bonds—
Steepener (Long 2Y / Short 10Y)—
US Treasury yields are approximate values at the start and end of each period. Profit and loss is based on approximate duration (2-year ≈ 1.9, 10-year ≈ 8.5), excluding interest received along the way and convexity. The steepener holds two legs with equal sensitivity (DV01-neutral). An educational example, not Brevan Howard’s actual position
What this means for Forex
Currencies often follow the short-term interest rate gap between two countries. In 2022, when the US 2-year yield jumped from about 0.7% to over 4%, the dollar strengthened sharply against almost every currency. Gold, meanwhile, often comes under pressure when real interest rates rise
COUPON · COST OF TRADING
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Open account ↗1TRADER is a partner (IB) and earns a commission when you open an account through our link · % is the share of IB commission returned to you · How to get rebates
04
Define the downsideLab: buying outright vs buying an option, what’s the difference?
The Hedge Fund Journal explains that Brevan Howard’s traders often build positions with options so that the downside risk is a number known in advance: the premium paid. Suppose you think bond prices will rise (rates will fall). Compare buying outright with buying a call option of the same size
Buy outright at this price—
Call option at this price—
Maximum loss: buying outrightUnlimited
Maximum loss: option—
A simple model: the option is at-the-money and held to expiry. Profit and loss is a % of position value, excluding spreads and changes in volatility along the way. In Forex and gold too, a buyer of a call or put option can lose at most the premium. For an ordinary order, use a stop loss instead, which limits losses but does not guarantee the price on days when price gaps
TERM SHEET · FEESSmall costs per lot add upTrade with XM account through 1TRADER and get up to 90% of the IB commission on every lot
1TRADER is a partner (IB) and earns a commission when you open an account through our link · % is the share of IB commission returned to you · How to get rebates
05
Stress testLab: stress-test a portfolio against past crises
Brevan Howard’s risk team stress-tests the portfolio every day against past crises, such as Black Monday 1987, sterling’s exit from the ERM in 1992 and LTCM in 1998. Build your own portfolio and see how much it would lose if the same events happened again, and how many times it would break the loss limit you set
1987October 1987 · Black Monday
—
1992Sep–Oct 1992 · Sterling leaves the ERM
—
1998Aug–Oct 1998 · Russia / LTCM
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2008Sep–Nov 2008 · Lehman
—
2020Mar 2020 · COVID
—
20222022 · rapid rate hikes
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Gross position size (ignoring direction)—
Worst crisis—
Limit breaches—
Moves are approximate peak-to-trough figures over each period (bonds as price, not yield). They did not happen in a single day, and the assets did not bottom at the same time. Positive values are Long, negative are Short, as a % of capital. Sizes above 100% mean leverage
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Fact checkFact check: truth and exaggeration
Brevan Howard’s figures span several funds and periods, so they are often mixed up. We sort each claim by the weight of the evidence
Howard made 100% in 2020
The over-100% figure belongs to AH Master Fund, the fund Howard trades himself. The firm’s main fund made +27.4% that year, as reported by Bloomberg
Never had a losing year
True only for the early years. The flagship fund had no losing year until 2014, when it lost 0.82%, and in the years after that there were several years of weak performance that drove money out
Assets fell by more than 80%
From a peak of about $40 billion in 2013 to about $6.3 billion in 2018. Bloomberg says that was a drop of more than 80% from the peak
A risk team separate from the traders
The Hedge Fund Journal explains that each trader has written mandates on limits and stop losses, an independent risk team checks them, and the portfolio is stress-tested against past crises such as 1987, the 1992 ERM crisis and LTCM in 1998
Brevan is a person’s name
It isn’t one person’s name. Wikipedia says the firm’s name was formed by combining parts of the founders’ surnames
Howard retired from Brevan Howard
In 2019 he handed the CEO role to Aron Landy, the former head of risk, but he still manages money at the firm and has not retired
Brevan Howard is a crypto fund
The firm is still mainly Macro but has added a digital assets unit, and Wikipedia says Howard backed One River Digital’s purchase of bitcoin and ether in 2020. It is a side business, not the core business
Every lot you trade with XM through 1TRADER earns cash back of up to 90% of the IB commission, lowering your costs over time
Open an account for cash back ↗1TRADER is a partner (IB) and earns a commission when you open an account through our link · % is the share of IB commission returned to you · How to get rebates
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LessonsLessons for Forex and gold traders
Your checklist
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Interest rates are a currency’s gravity
Howard made money by reading central banks. Currencies whose rates are likely to rise tend to strengthen. Before trading a pair, check what both countries’ central banks are about to do
Know how much you’d lose on a shock day
His firm stress-tests its portfolio against past crises every day. Retail traders can do a simple version by asking: if price jumped against me as far as on the biggest news day, what would my account be left with?
Limit your loss before you enter
Buying an option tells you your maximum loss from the start. For Forex and gold, the closest equivalent is placing a stop loss when you open the order and accepting the small cost that comes with it
In quiet markets, trade smaller
In 2013–2018, when rates barely moved, Macro struggled to find opportunities. When ranges are narrow and there’s no big news, cutting size or taking a break beats forcing trades, and the cost per lot matters even more
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Quiz5-question quiz
Question 1 / 5
In which year was Brevan Howard founded?
It was founded in 2002, and the main fund launched in April 2003
Which market is Alan Howard most expert in?
He started in the bond market at Salomon Brothers and made money by anticipating central bank policy
Roughly how did the Master Fund perform in 2008?
About +20.4%. The loss of about 19% was the average for the whole hedge fund industry that year
Which fund does the over-100% gain in 2020 belong to?
The main fund made +27.4% the same year
If you buy a call option and the price moves sharply against you, what is the maximum loss?
An option buyer can lose at most the premium. That’s why the firm likes to use options to set its downside risk in advance
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Read the central bankRead central banks well, and know how much you’d lose if you read them wrong
What you can apply is following interest rates, the main driver of currencies and gold, estimating the damage on a shock day before opening an order, and keeping trading costs low.
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Further readingFurther reading
- Inside the House of MoneySteven Drobny · 2006Interviews with several Global Macro fund managers explaining this style’s thinking on interest rates, central banks and risk control. It is not a book about Howard himself
- Fixed Income SecuritiesBruce Tuckman and Angel Serrat · 2011 (3rd edition)A core textbook on bonds, the yield curve and duration, for anyone who wants to seriously understand the market Howard trades
Sources for this article
- Wikipedia: Alan Howard (hedge fund manager)
- Wikipedia: Brevan Howard
- Institutional Investor: He Was Once a Macro God. Now Alan Howard Wants to Be More Than That.
- The Hedge Fund Journal: Managing Risk and Money the Brevan Howard Way
- Bloomberg: Brevan Howard’s Main Hedge Fund Gains 27% in Best Year on Record (2021)
- Yahoo Finance / Reuters: Brevan Howard’s 11-year winning run ends in 2014
- Financial Advisor: Brevan Howard’s Biggest Hedge Funds Gain As Much As 28% In 2022
- Bloomberg: Brevan Howard Slashes Traders’ Risk-Taking as Losses Exceed 5% (2025)
- Disruption Banking: How Brevan Howard’s Flagship Fund Stopped Making Big Returns (2026)
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FAQFrequently asked questions
Who is Alan Howard?
A British interest rate trader who co-founded Brevan Howard in 2002. It once had peak assets of about $40 billion and was one of Europe’s largest Global Macro hedge funds
How does Brevan Howard make money?
Mostly from trading interest rates, bonds and currencies, by anticipating how central banks will raise or cut rates, and using options to limit downside risk
How much did Howard make in 2020?
His own AH Master Fund, which he trades himself, made over 100%, while the firm’s main fund made +27.4%, its best year since 2003
Why did Brevan Howard’s assets once fall so much?
In 2013–2018 central banks held rates low and rate markets were quiet, so Macro funds struggled to profit. Weak performance led investors to withdraw, and assets fell from about $40 billion to about $6.3 billion
How can his ideas be used with Forex and gold?
Follow central bank policy, the main driver of currencies and gold, work out how much your account would lose on a shock day, set a stop loss when you open an order, and trade smaller when markets are too quiet to offer opportunities
Educational content, not investment advice. Return and asset figures are publicly reported figures. The labs use approximate data and simple models. · risk disclosure · Forex glossary