Early 2024 saw a significant increase in hedge fund launches, pushing industry assets to an all-time high of $4.3 trillion due to escalating geopolitical risks, as detailed in the latest HFR Market Microstructure Report. Read about the latest insights and updates in the world of hedge funds by subscribing to Alpha Watch Tower here: https://lnkd.in/gmaXp72X #hedgefunds #talent #assetmanagement #hiring #financialservices #investment
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📣 Emerging Fee Structures Challenge Traditional '2 and 20' Model in Hedge Fund Industry In a move that defies the broader industry trend towards cost reduction, some key players in the hedge fund space are introducing new types of fees. The traditional '2 and 20' fee structure is undergoing a transformation, with the introduction of 'pass-through' and 'compensation' fees to make up for revenue shortfalls. 🔑 Key Point: The "pass-through" model is enabling multi-strategy funds to hire aggressively. Interestingly, this can sometimes elevate the effective management fee to as high as 6/7%, a significant departure from the conventional 2%. 📈 These new fees are designed to cover operational expenses, including the crucial task of hiring and retaining top-tier talent. 📉 The backdrop to these changes is a challenging environment for hedge funds, marked by a decline in new launches and average returns that lag behind broader market indices. 🤔 The introduction of these new fees is a double-edged sword. While they may help funds cover operational costs and retain talent, they also place an additional burden on investors, particularly when these fees are levied regardless of fund performance. 👀 Investors must scrutinise the value they receive in return for these additional fees. If the returns don't justify the higher costs, a shift in capital allocation could be on the horizon. With the top multi-strategy groups closed to any new outside capital, we've seen a rapid rise of multi-strategy competitors where this additional capital has gone. For more details, read the full article below. https://lnkd.in/dBfKxMBT #quanttrading #quant #portfoliomanagement #hedgefunds #quantitativeresearch #financialmarkets #quantitativefinance #feestructure #capitalallocation
Hedge funds bring in new fees amid pressure on ‘2 and 20’ structure
fnlondon.com
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📣 Emerging Fee Structures Challenge Traditional '2 and 20' Model in Hedge Fund Industry In a move that defies the broader industry trend towards cost reduction, some key players in the hedge fund space are introducing new types of fees. The traditional '2 and 20' fee structure is undergoing a transformation, with the introduction of 'pass-through' and 'compensation' fees to make up for revenue shortfalls. 🔑 Key Point: The "pass-through" model is enabling multi-strategy funds to hire aggressively. Interestingly, this can sometimes elevate the effective management fee to as high as 6/7%, a significant departure from the conventional 2%. 📈 These new fees are designed to cover operational expenses, including the crucial task of hiring and retaining top-tier talent. 📉 The backdrop to these changes is a challenging environment for hedge funds, marked by a decline in new launches and average returns that lag behind broader market indices. 🤔 The introduction of these new fees is a double-edged sword. While they may help funds cover operational costs and retain talent, they also place an additional burden on investors, particularly when these fees are levied regardless of fund performance. 👀 Investors must scrutinise the value they receive in return for these additional fees. If the returns don't justify the higher costs, a shift in capital allocation could be on the horizon. With the top multi-strategy groups closed to any new outside capital, we've seen a rapid rise of multi-strategy competitors where this additional capital has gone. For more details, read the full article below. https://lnkd.in/dBfKxMBT #quanttrading #quant #portfoliomanagement #hedgefunds #quantitativeresearch #financialmarkets #quantitativefinance #feestructure #capitalallocation
Hedge funds bring in new fees amid pressure on ‘2 and 20’ structure
fnlondon.com
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📉 What Distinguishes Hedge Funds: Navigating All Market Conditions 📈 Hedge funds stand out in the investment world for their unique ability to employ diverse strategies that can generate returns irrespective of market trends. Unlike traditional funds that often rely heavily on bullish markets, hedge funds are designed to capitalize on opportunities in both rising and falling markets. #Investing #HedgeFunds #MarketStrategies #FinancialMarkets #InvestmentStrategies https://lnkd.in/dbT8q6H3 Peregrine Capital Kavita Patel
FundHub-The-Rise-of-Hedge-Funds-in-South-Africa-A-guide-to-understanding-this-asset-class.pdf
fundhub.co.za
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📈 Advancing Risk Assessment in Hedge Funds 🛠️ Dive into my latest article: "Sharpe Ratio Reimagined: Adjusting for Non-Normal Returns in Hedge Fund Portfolios." Discover the innovative adjustments that are redefining the Sharpe Ratio for today’s complex hedge fund market. In this piece, we unravel: ✔️ Challenge and refine the classic Sharpe Ratio ✔️ Decode financial return distributions with precision ✔️ Apply robust statistical methods for actionable insights Check out the article and share your thoughts on the essential upgrades to traditional financial tools like the Sharpe Ratio! . . . #HedgeFunds #SharpeRatio #InvestmentAnalysis #RiskManagement #QuantitativeFinance #MachineLearning #FinancialInnovation
Sharpe Ratio Reimagined: Adjusting for Non-Normal Returns in Hedge Fund Portfolios
medium.com
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📣 Emerging Fee Structures Challenge Traditional '2 and 20' Model in Hedge Fund Industry In a move that defies the broader industry trend towards cost reduction, some key players in the hedge fund space are introducing new types of fees. The traditional '2 and 20' fee structure is undergoing a transformation, with the introduction of 'pass-through' and 'compensation' fees to make up for revenue shortfalls. 🔑 Key Point: The "pass-through" model is enabling multi-strategy funds to hire aggressively. Interestingly, this can sometimes elevate the effective management fee to as high as 6/7%, a significant departure from the conventional 2%. 📈 These new fees are designed to cover operational expenses, including the crucial task of hiring and retaining top-tier talent. 📉 The backdrop to these changes is a challenging environment for hedge funds, marked by a decline in new launches and average returns that lag behind broader market indices. 🤔 The introduction of these new fees is a double-edged sword. While they may help funds cover operational costs and retain talent, they also place an additional burden on investors, particularly when these fees are levied regardless of fund performance. 👀 Investors must scrutinise the value they receive in return for these additional fees. If the returns don't justify the higher costs, a shift in capital allocation could be on the horizon. With the top multi-strategy groups closed to any new outside capital, we've seen a rapid rise of multi-strategy competitors where this additional capital has gone. For more details, read the full article below. https://lnkd.in/d8aNbjMH #quanttrading #quant #portfoliomanagement #hedgefunds #quantitativeresearch #financialmarkets #quantitativefinance #feestructure #capitalallocation
Hedge funds bring in new fees amid pressure on ‘2 and 20’ structure
fnlondon.com
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🚨 Hedge Fund Face-Off: Fee Cuts vs. Fee Hikes! 🚨 𝗕𝗿𝗲𝘃𝗮𝗻 𝗛𝗼𝘄𝗮𝗿𝗱 and 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝗙𝘂𝗻𝗱 𝗠𝗮𝗻𝗮𝗴𝗲𝗺𝗲𝗻𝘁 (𝗖𝗙𝗠) are taking radically different paths in the competitive world of hedge funds. One is cutting fees to manage costs, while the other is hiking them to stay ahead in the quant arms race. While the two are not direct competitors given their contrasting trading styles, I find it interesting the fees are going in different directions nonetheless. Brevan Howard Asset Management is slashing fees for its Alpha Strategies fund to manage high tech and talent costs. The management fee has been cut to 0% until the new year, then to 0.5% for one quarter, before reverting to 1%. Despite these adjustments, the fund, with $12.2 billion under management, faced a 3.6% loss this year through May. 📉 Capital Fund Management (CFM), on the other hand, is increasing its performance fee to 30% for its flagship Stratus fund, which has gained 8.7% this year. CFM's $11.7 billion Stratus fund excels in the quant arms race, boasting a robust 18.3% gain in 2022. 📈💹 While Brevan Howard is restructuring to reduce expenses, CFM is capitalising on market volatility and the demand for cutting-edge quant strategies. How will this play out? Time will tell. ⏳ Check out the CFM article here: https://bloom.bg/3SmtdGh And the Brevan article here: https://bloom.bg/3WxMoQ1 #hedgefunds #quantitativeresearch #portfoliomanagement #financialmarkets #investmentstrategy #fintech
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What were the key developments in hedge fund strategies during the first half of 2024? Read the full article here: https://lnkd.in/dWbVTAGN If you are on the hunt for the best global trading and technology talent to position your Hedge Fund at the forefront of the industry, contact us here: https://lnkd.in/dwnkK4F2 #hedgefunds #financenews #industrynews #report #industrytrends
Developments in hedge fund strategies in the first half of 2024
paragonalpha.com
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Building off a solid finish in 2023, hedge funds in 2024 look to build on that momentum. The opportunities are there, but challenges certainly remain. https://lnkd.in/gsfj6JSn #hedgefund #hedgefunds #investmentmanagement #empaxis
Hedge Fund Trends 2024
empaxis.com
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Explore the latest from Goldman Sachs on shifting dynamics within the hedge fund industry, detailed in a thought-provoking piece by Nell Mooney Mackenzie on Reuters. Learn why investor's appetites are waning for high-fee multi-strategy hedge funds and what it signifies for the broader investment landscape. https://lnkd.in/esBs5a3A #PrivateDebt #PrivateCredit
Hedge fund investor appetite wanes for high fees and private credit, says Goldman Sachs
reuters.com
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Investor appetite for hedge funds is on the rise, and here is why it is a positive trend! The insightful article below highlights "4 Reasons Why Hedge Fund Allocations Are on the Rise." From enhanced diversification to high-risk adjusted returns, hedge funds are proving to be invaluable assets in today's dynamic market landscape. Read the full article here: https://lnkd.in/gfV3pN2X Interested in exploring hedge fund opportunities? Reach out to us at ir@aquis-capital.com to learn how we can help you navigate the financial markets with confidence. #hedgefunds #investing #finance #markettrends
4 reasons why hedge fund allocations are on the rise
livewiremarkets.com
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Director at Swiss Data Safe AG
3moThe question is not AUM but alpha return and we are heading for a monumental disaster in this sector! It has a name stamped already, climate change exponential runaway face... Just brace for impact lads! Unless...