3.6.3.3Vertical

Long/Short Equity Funds

Hedge funds employing long and short equity investment strategies.

Market snapshot

These figures describe Hedge Funds & Alternative Investments (3.6.3), the segment that Long/Short Equity Funds sits within — not Long/Short Equity Funds on its own.

Market size
~$14B
Growth
~11.3%CAGR (2017–22, nominal)
Companies
~3,600
FragmentationConsolidatingEstimate

U.S. Census Bureau 2022 CBP/Economic Census, NAICS 523999 (Miscellaneous Financial Investment) + 525990 (Other Financial Vehicles) — fee revenue; AUM is far larger.

Business model & economics

Revenue model

Management and performance fees on alternative strategies

Key economics

Recurring revenue
Moderate

management fees recur; performance is variable

EBITDA margin
Strong

fee-and-performance economics

Capex intensity
Low

Characteristics

  • Bifurcated between multi-strategy giants and a single-strategy tail.
  • Multi-manager pod-shop model reshaped economics and talent.
  • Performance, talent, and risk management drive results.

Geographic concentration

AlabamaAlaskaArizonaColoradoGeorgiaIndianaKansasMaineMassachusettsNew JerseyNorth CarolinaNorth DakotaOklahomaPennsylvaniaSouth DakotaTexasWyomingConnecticutMissouriWest VirginiaNew MexicoArkansasCaliforniaDelawareDistrict of ColumbiaHawaiiIowaKentuckyMarylandMichiganMississippiMontanaNew HampshireNew YorkOhioOregonTennesseeUtahVirginiaWashingtonWisconsinNebraskaIdahoNevadaVermontLouisianaRhode IslandFloridaMinnesotaIllinoisSouth Carolina

Hedge funds and alternative managers over-index in Illinois (Chicago's derivatives and quant base) and Florida (the recent manager migration to Miami), with further concentration in South Carolina and Minnesota.

IllinoisSouth CarolinaFloridaMinnesota

U.S. Census Bureau — 2022 County Business Patterns (establishments by state), NAICS 523999. Concentration shown by location quotient.

M&A deal context

Deal activityModerate

Who’s acquiring

  • Multi-strategy platforms
  • Alternative-asset managers
  • GP-stakes investors

What’s driving deals

  • Multi-strategy platforms absorbing talent and capital.
  • Fee pressure on single-strategy funds.
  • GP-stakes and manager consolidation.

Find Long/Short Equity Funds acquisition targets

Search Acquisera’s index for companies classified under Long/Short Equity Funds (3.6.3.3) and build a targeted deal pipeline.

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