22 June 2018

44975

Retired Member

3,605Posts 14,079,494Views 4,500Comments

Hedge Funds Turning to I-Banking

05 June 2009  |  8297 views  |  0

Last month Citadel Investment Group announced that it is launching an investment banking division. The company sees huge potential for transactions going forward, and given its outsize capital base, has the distribution network and liquidity at its disposal to execute. Other firms could follow suit, such as publicly-held Fortress (FIG).

But is this the best strategy? It's true that there has been perhaps no better time to be a boutique investment bank. Wall Street has been decimated by the events of the last 18 months, providing small shops with the dual windfall of talent and competitive advantage.

Rather than build an investment bank from scratch, there are numerous firms which could provide hedge funds with access to the coming wave of M&A and IPOs. Even in this age of advanced financial (yet impersonal) technologies, traditional investment banking remains heavily relationship-driven, and cultivating those relationships takes time and resources. We believe that hedge funds would do better to consider a strategic partnership or acquisition as this would provide a more efficient structure, and hasten top-line revenue growth.

TagsTrade execution

Comments: (0)

Comment on this story (membership required)

Retired's profile

job title
location
member since 2014
Summary profile See full profile »

Retired's expertise

Member since 2009
3587 posts4,500 comments
What Retired reads

Who's commenting on Retired's posts

Pooja Golakonda
Behzod Sabirov
Ketharaman Swaminathan
Melvin Haskins
James Treacher
Kenneth Marritt
Mark Santall
Alexander De Lange
Graham Seel
Kishore Meda
Willem Lambrechts