Attracting and retaining the top tech talent is now tougher than ever for hedge fund managers, as competition for data engineers, coders and computer scientists intensifies. Hedge fund firms of all stripes and strategies are preparing to ramp up their tech expertise over the next 12 months, according to a Hedgeweek survey conducted for this report. A poll of some 30 hedge funds on both sides of the Atlantic probed firms on how technology, data and systems are reshaping their business models, and how managers are adapting to this shifting environment. Quizzed about their plans to add more specialist staff

As financial markets have rapidly digitised over the past decade, and the availability and pace of the information exchange has accelerated, the traditional barriers between human- and machine-based strategies are steadily being eroded. Traditional discretionary hedge funds that utilise the portfolio-building skills and investment instincts of star traders and portfolio managers have often stood in sharp contrast to the tech-heavy, computer-based quant strategies built around algorithms, data and machine learning applications. Now, though, a cursory glance across today’s industry landscape suggests more and more discretionary ‘human-first’ hedge funds are employing technology and data to both streamline and strengthen their front-

A volatility spike, sparked by inflation fears, rising interest rates and geopolitical tensions, has seen hedge fund attract the largest inflows in seven years during Q1, with investors seeking downside protection amidst market turbulence, according to a report by CNBC.

Over the past two years, three trends have emerged across all-sized hedge funds regarding outsourcing. The first: outsourcing more services than before Covid-19 for cost-effectiveness; the second: an increase in use of cloud providers and data solutions; and finally: closer attention to cybersecurity risks.

The hedge fund industry turned back to outflows in February, experiencing -$3.19 billion in net redemptions, -0.07% of industry assets, according to the Barclay Fund Flow Indicator published by BarclayHedge, a division of Backstop Solutions. Despite the trading losses and redemptions, data coming in from newly added funds led our models to show an increase in hedge fund industry assets to $5.04 trillion. Subsectors reporting inflows in February included Multi-Strategy funds bringing in $10.11 billion; Convertible Arbitrage funds attracting $2.57 billion; Emerging Markets – Global funds adding $2.03 billion; Merger Arbitrage funds with $1.57 billion in inflows; and Sector Specific

As hedge funds continue to tap into alternative datasets to help manage risk and boost performance, the need for managers to strengthen their expertise in sourcing, testing and processing information is now critical.

The outbreak of the Covid-19 pandemic has created a breeding ground for an increase in fraudulent activity, as the world shifted to working from home and reliance on digital technology was heightened in all aspects of daily life. This underscored the need for tighter procedures and processes around detection and protection within all sectors, but especially financial services.