The Efficiency of Small Hedge Funds in the Financial Industry
Hedge fund SurgoCap Partners recently made headlines for its impressive $6bn in assets under management (AuM). What sets them apart, however, is the remarkably small team that helped them achieve this milestone.
The Power of Lean Hedge Funds
SurgoCap, founded by Mala Gaonkar, a rare female hedge fund chief, operates with just 24 employees according to its latest regulatory disclosure. This level of efficiency is a standout in an industry that is moving towards institutionalization.
Another example is Egerton Capital, a London-based fund with $19.1bn in AuM and only a 13-person investment team. Similarly, The Children’s Investment (TCI) Fund Management, led by Chris Hohn, manages $70bn with just fifty employees. These small teams manage over $100bn in assets, averaging $1bn in managed assets per employee.
Advantages of Working for Small Hedge Funds
Employees at small hedge funds have unique benefits. They work closely with decision-makers, fostering mentorship and networking opportunities. With fewer team members, there are more significant bonus incentives to go around compared to larger firms like Millennium and Citadel.
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