AHL?

Hi Robert,

Thanks for asking - it brings up an interesting issue

The short answer: About 40 firms you might expect to see are missing for reasons detailed below. I make the entire table (featuring 350+ firms in 100 affiliate groups) available from my website upon request.

The long answer: Many large hedge funds are part of a complex of firms I call an affiliate group. The details of affiliates are laid out in Item 7 of each firm's Form ADV. It is not always obvious which member of the affiliate group is THE hedge fund! AHL is a good example of this. It is part of a group of 7 affiliates all of which report substantial $AUM (from $700m up to $25bn). I restricted the table in this first post to those firms which had only one member of the affiliate group reporting $AUM.

In future posts, I plan to expand the scope to all money managers, and figure some concise way of presenting information across affiliate groups.

Hope this clarifies!

Ian

‪ https://www.youtube.com/embed/0BYRyEB-tb4‬

Lot of wrong numbers here. Estimating from Reg sources without accounting for leverage gives a v wrong impression

Most of these guys have just as many FT "contractors", advisers, as FTEs.

The overhead is way higher.

attempt to diversify correlated asset holding futile but demonstrated by descrepancy between top 3 and the rest... interesting visual thanks for posting

Is it a wrong figure ? if $bn stands for 1 Billion USD..... hard to believe that Pine River 's AUM reaches 90 B (90000M) USD .....Millennium Partner, 200B which is 15 times of 5 years ago figure.

Hi Cian,

Thanks for commenting - leverage is indeed an important issue when considering AUM.

Regulatory assets under management is just one more data point. It’s useful for a couple of reasons:

First, the SEC defines how it is calculated so there’s not much wiggle room for the manager.

Second, this is a figure that investors (i.e. customers) pay attention to; it affects perceptions.

There is much more to be learned from your competitors’ ADVs, as I hope to show in future articles.

i worked for one of these top firms and your figure for them is way off like 8X too high which is about the leverage they use. i don't think thats coincidence. maybe you are using total amount invested for aum. seems that's the case for many of these firms.

Hi Brian and Rostant,

Thanks for commenting.

To be clear, the AUM figure is as reported on each firms' Form ADV. The SEC specifies how to calculate the value. It is the size of the portfolio of securities being managed. It is useful BECAUSE it is different from the "league tables" of AUM - which are self-reported and reflective of a firm's fee base. The difference contains valuable strategic information.

An example: A CTA is going to report regulatory AUM lower than "trading level" as investors only need to pony up enough cash for margin. A long-short equity manager is going to report regulatory AUM higher than their fee base as they use leverage to increase their securities portfolio.

I hope this clarifies why this information is of interest - this is part of an on-going effort which will evolve over time. I will publish a more general post on this topic later this week.

Ian

lets face it size only serves to make certain institutions and their employee analysts comfortable but it is not necessarily related to strategy correlation and performance, which should be more important cpnsiderations of any investir

Thank you for your information

AUM usually refers to the capital managed by the firm. This is the gross notional. Sure it's an informative number somewhat but please don't call it AUM.

Here's my question: why do we want to know this? Is it contended that these are ipso facto the best funds? Surely not. Or the reverse, that since "smaller funds do better" than these are funds to avoid? (A bit much, what?)...I get that large institutional investors have no choice but to go with large funds but even that does not tell me what to do with AUM rankings.

Its informative as the ratio of Gross to AUM is an indication of the long term SR and DD profile of the manager and the shorter term risk budget being employed. The more sophisticated, diversified and better risk/DD managed funds have the ability to run higher leverage.