With Growing Complexity And Shifting Regulatory Demands, Hedge Fund Administrators Grow To Survive

As degrees of administrative complexity have been mounting for hedge fund managers, increasingly they are outsourcing the complexity to third-party administrators. A recent Citco report noted that the alternative investment industry is at a “tipping point” as shifting regulatory challenges, rising costs, increased technology needs, and strategy complexity is encouraging fund managers to focus on investments and increasingly outsource the complexity.

As the landscape for fund managers change, so, are administrators, as evidenced by the recent acquisition of Deutsche Bank Alternative Fund Services by Apex Fund Services. The move highlights how fund services are finding competitive advantages by increasing their size and reach – and in doing so, they create economies...