Hedge fund pay seen dwarfing Wall Street

NEW YORK (CNNMoney.com) -- The pay packages of top hedge fund managers dwarfed the biggest salaries on Wall Street, according to a report Tuesday.

In 2006, three hedge fund managers took home over $1 billion on the year, according to Alpha magazine's new list of the top 25 fund earners.

The top 25 hedge fund managers took home $14 billion in 2006, more than the gross domestic products of Jordan or Uruguay, according to the report.

James Simons of Renaissance Technologies Corp., the top performer in 2006, earned $1.7 billion on the year.

No. 2 Kenneth Griffin, of Citadel Investment Group, made $1.4 billion on the year, while third-place Edward Lampert took home $1.3 billion on the year, said Alpha.

Lloyd Blankfein of Goldman Sachs (Charts, Fortune 500), the highest-paid CEO on Wall Street, earned $54.3 million in total compensation on the year.

The average manager on Alpha's list took home $570 million last year, compared to $362 million in 2005 and $251 million the year before.

Hedge fund pay packages have always been high, but compensation accelerated especially fast in 2006.

Hedge funds, which are private investment tools targeted at institutions and the wealthy, have seen major inflows of money as stock markets have turned in robust performances.