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Big hedge fund firms pull in cash and talent in 2022

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The world’s largest hedge fund firms are attracting the lion’s share of investor allocations and the brightest talent according to a report by Bloomberg, with 2023 set to be a pivotal year for the $4 trillion industry.

The overwhelming majority of hedge fund indices are negative so far this year, but multi-strategy and macro funds, which have attracted the largest share of investor cash, have posted gains and helped to shield clients from a stinging stock market sell-off prompted by rising interest rates and a pivot away from years of quantitative easing by central banks.

Multi-strategy giants Citadel and Millennium Management have both chalked up double-digit gains so far this year, while macro specialist such as $5 billion Haidar Capital and $15.5 billion Rokos Capital Management, are poised to produce record annual gains.

The report cites Nicolas Roth, head of alternative assets at Geneva-based private bank Reyl & Cie as saying that: “2022 is a tale of bifurcation on all aspects. From performance, asset raising to hiring, big hedge funds roared back, while small guys are struggling.”

And given rising interest rates, and a deteriorating global economy in general, the stage is set for the big players in the hedge fund industry to continue to prove their mettle in 2023. 

The report quotes Mario Unali, a senior money manager at hedge fund investor Kairos Partners as saying that: “Next year is almost the perfect setting for a hedge fund strategy. You get higher rates, you get more volatility, you get fundamentals that are back in business and it’s not going to be all about passive investments.”

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