- Insights
Launching a hedge fund can present many compliance challenges for new and emerging managers. At our third quarterly Emerging Manager Knowledge Exchange (EMKx) event, we explored the three main obstacles that new and emerging managers face.
New, emerging and smaller managers face challenge after challenge as they seek to establish or grow their funds. One significant consideration is choosing the right Prime Broker (PB) partner. While larger, traditional PB’s offer extensive resources, they often fall short in terms of speed, flexibility, and personalised service, particularly for new and emerging managers. In contrast, boutique prime brokerages like Linear provide a compelling alternative, offering a range of advantages tailored to the unique needs of these managers.
One of the most critical factors for emerging managers is the speed with which they can open accounts with partners. Traditional PB’s, with their complex hierarchies and challenging administrative regulatory checks can take considerable time to onboard new clients. Delays are frustrating and sometimes costly for managers eager to deploy their strategies and generate returns. In contrast, Linear prides itself on being nimble and flexible. As a smaller firm, Linear can streamline the account opening process, making decisions internally without the need to navigate through multiple layers of bureaucracy, time zones or jurisdictions. As a result of this, our managers have accounts up and running swiftly, allowing them to capitalise on market opportunities without undue delay.
In larger PB’s, managers often find themselves dealing with different people and multiple points of contact spread across different jurisdictions. This can lead to miscommunication and a lack of continuity in service. At Linear, our approach is markedly different. Our clients benefit from direct communication with dedicated service teams who understand their specific needs and challenges. This personalised service ensures managers receive consistent support and expert advice tailored to their unique situations, fostering a more collaborative and effective working relationship, which sets us apart from the sea of larger, more traditional alternatives in the PB market.
At Linear we excel in offering flexible and customisable solutions not always available in a larger and structured PB. Whether it’s tailored risk management strategies, bespoke reporting, or customised trading platforms, Linear can adapt its services to meet each client’s specific requirements. This flexibility is crucial for managers who need adaptable solutions that can evolve with their growing funds.
We specialise in serving emerging managers and new funds. This focused expertise means that we are acutely aware of the challenges and opportunities that these managers face. Linear’s team brings experience and insight into the specific needs of new funds, providing invaluable guidance and support. This specialised knowledge is a significant advantage over larger PB’s that may not offer the same granularity of focused attention.
The bureaucratic nature of large PB’s can be a significant impediment to efficiency. Emerging managers dealing with these firms may need to secure approvals from stakeholders in various jurisdictions; from compliance teams based in Luxembourg to risk management in the UK, which can slow down processes considerably. With our leaner organisational structure, Linear can make decisions far quicker and with greater agility. This reduced bureaucracy translates to faster responses and more efficient handling of client needs.
For managers, the choice of PB partner can have significant impact. Linear provides a compelling alternative to larger PB’s, offering speed, flexibility, personalised service, and focused expertise that are perfectly aligned with the needs of many managers. By partnering with a nimble and adaptable firm like Linear, emerging managers can navigate the complexities of fund management more effectively and achieve their strategic goals.
Linear Investments LTD is authorised and regulated by the Financial Conduct Authority (“FCA”) FRN 537389. Linear is incorporated in England and Wales, registered no: 07330725. The value of investments, and the income from them, can go down as well as up.