New York: The Largest Hedge Fund Hub by Assets under Management – February 2014

by Alison Forrer

  • 27 Feb 2014
  • HF

Preqin’s Hedge Fund Analyst currently tracks over 4,500 active hedge fund managers, accounting for a combined total of $2.66tn in industry assets. The 2014 Preqin Global Hedge Fund Report shows that the industry as a whole has witnessed asset inflows of $360bn over the last year. A more detailed breakdown of global hedge fund managers by region shows that the majority of industry assets are concentrated across North America, with approximately 71% of assets managed by firms based in the US. 

By breaking hedge fund assets down further by US states and major global cities it is clear that US-based managers dominate the industry landscape, with 7 out of the top 10 locations in terms of hedge fund assets being in the US. London appears third on the list, breaking the stronghold of US states below New York and Connecticut, with Massachusetts and California completing the top five locations. 

New York-based hedge fund managers boast combined assets of $951bn. New York City is not only home to a number of billion dollar hedge funds, including Och-Ziff Capital Management and Renaissance Technologies; it is also the area with the highest concentration of hedge fund managers of any city worldwide with more than 1,000 firms. 

By comparison, Preqin analysis shows that in terms of hedge fund capital Connecticut comes second, with some $405bn in total assets. However, the state as a whole has a far lower number of firms overall. Connecticut has three main hedge fund hubs; Greenwich, Stamford and Westport. Westport is home to the largest hedge fund manager in the world, Bridgewater Associates, which has assets of $153bn, accounting for 38% of all hedge fund assets managed in the state. 

Massachusetts constitutes the fourth highest concentration of industry assets with an aggregate figure of $171bn. The majority of hedge fund assets are concentrated in the state capital of Boston, where 70% of firms are based, and the city is home to several big industry players, including Baupost Group and Adage Capital Management. 

The 2014 Preqin Global Hedge Fund Report shows that while Europe-based fund managers experienced a difficult 2013 with only a marginal increase in assets of $60bn, London has the highest number of hedge fund managers across the continent, and is second worldwide only to New York. London-based firms account for $370bn of total industry assets. Interestingly, St Helier is a new entrant into the top 10 locations for global hedge fund managers; this influx in hedge fund capital is as a result of Brevan Howard Asset Management relocating its hedge fund operations to Jersey. 

The hedge fund industry in Asia-Pacific is still developing, with managers based in the region running smaller sized funds than their North American and European counterparts. However, Hong Kong features high on the list, accounting for a total of $39bn in industry assets distributed among a growing number of hedge fund managers. With regards to the rest of the world, Sao Paulo also ranks highly, signalling its status as the financial centre of Brazil, with just over $34bn in aggregate assets.

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