In a new study of the nation’s largest SEC-registered hedge fund advisers, data reveals that advisers are taking a conservative, long-term approach to their business decisions, regardless of asset declines experienced by many from 2017 to 2018.
The Study confirms the notion that larger advisers are generally much more institutionalised in their approach, and have built their businesses to withstand short-term marketplace cyclicality. The Seward & Kissel 2017/2018 Form ADV Study is a first-of-its-kind report from the law firm to the hedge fund industry, which regularly uses data analysis to extract insights into the state of the hedge fund marketplace. The full Study, based on public information in Forms ADV, is available here.
According to the Study, despite the well-publicised fluctuations in regulatory assets under management within the industry from 2017 to 2018, many advisers were reluctant to trim payrolls, engage in extensive social media use, or advise separately managed accounts. These actions, taken together, suggest a long-term outlook by advisers, who are no strangers to fluctuations in the marketplace.
“Most law firms stop at how,” says Steve Nadel, lead author of The Seward & Kissel 2017/2018 Form ADV Study and partner in the firm’s investment management group. “We also answer why, through extensive data analytics, so that our clients can have real market intelligence available to them when making decisions to help them grow their businesses.”
According to the study, only 23 per cent of advisers disclosed a material decrease in the number of employees reported, while only 31 per cent of advisers advised separately managed accounts. Most advisers meanwhile, use no social media tools other than LinkedIn and a website.