Hedge Funds

Raffaele Savi: Something very interesting is happening to investment management.

In the last 40 years, the largest managers have systematically, substantially outperformed smaller managers. And I think that the two reasons why that that's been true, one is the role of technology. So as investment processes are becoming more and more efficient at absorbing information and leveraging information and building systems that can scale and multiply the value of those insights, whether it's generative AI where these models are getting larger and larger, or whether it's technology firms where in the last 10 years, there's been the emergence of the trillion dollar market cap firm. The ability to do this at scale is an important advantage.

Source: HFR. Larger managers are defined as those in the first quartile of HFR by AUM. As of August 31, 2024. For illustrative purposes only. The figures shown relate to past performance. Past performance is not a reliable indicator of current or future results. Performance period is from July 31, 2004–July 31, 2024.