11,000+ hedge funds, proprietary trading houses, Commodity Trading Advisers (CTAs), asset management companies; funds of funds, pension, sovereign funds, university endowments and similar upstream investment organizations;
Of these, 7,524 are traditional hedge funds, 1,723 – managed futures or CTAs and 2,074 funds of hedge funds. They are managed by more than 4,500+ separate firms;
Quant departments of not falling under the Volcker rule corporate and investment banks, and broker-dealers.
Market size estimates
Based on public information and RACS in-house estimates, the gross market value of the global hedge fund, managed accounts, investment and commercial bank trading industries is well in excess of $3 trillion/year;
Based on the standard compensation structure of these organizations consisting of or equivalent to the amount equaling to the 2% of the invested capital and 20% carry of the generated profits, and based on various assumptions in the range from conservative to aggressive, one can estimate the market share allocated to the in-house decision making technology providers to be $7-15 billion a year.
“Successful asset managers will adapt to changing demand drivers by: Segmenting clients in order to properly position products against desired outcomes.”