The Dubai International Financial Centre (DIFC) has reported a record-breaking 25% increase in company registrations last year, with the surge in part being driven by a wave of hedge funds, including Dymon Asia and JJJ Capital, setting up operations in the city, according to a report by Bloomberg.
The DIFC is now home to 75 hedge funds, nearly double the number from the previous year, with 48 of them managing over $1bn in assets each. The growth cements Dubai’s status as one of the world’s top 10 locations for hedge funds, with ambitions to break into the top five in the near future.
Hedge fund giants Millennium Management, BlueCrest Capital Management, and Balyasny Asset Management have all expanded in Dubai, reflecting a broader industry trend of firms seeking new bases outside traditional financial centres such as London and New York.
The report cites DIFC Governor Essa Kazim as saying in a statement that: “The Centre has become one of the most sought-after destinations for alternative asset managers, and this momentum shows no signs of slowing.”
Dubai’s rapid growth is attracting firms from Europe, the US, and Asia, with financial institutions increasingly using the DIFC as a launchpad for global operations. The free-zone’s regulatory framework and high-end infrastructure are proving to be key advantages for hedge funds looking for operational efficiency and tax-friendly jurisdictions.
Dubai isn’t the only Gulf city vying for hedge fund business though, with Abu Dhabi having also emerged as a hedge fund hub, offering a strong pull due to its sovereign wealth funds which manage over $1.6tn in assets. Brevan Howard Asset Management now manages more capital from Abu Dhabi than from any other location.
