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Marshall Wace is planning to open an office in Abu Dhabi in the coming months, according to people familiar with the situation.
The move is designed to help the $65bn hedge fund manager be closer to the Middle Eastern investor base — an important source of capital — and to be fiscally competitive for talent, the people said. Marshall Wace declined to comment.
The Gulf states are marketing themselves as financial centres with attractive regulatory and tax regimes. Marshall Wace would follow major hedge funds including the likes of Chris Hohn’s TCI, Izzy Englander’s Millennium, Steve Cohen’s Point72, quant investing firm AQR and macro fund Brevan Howard in opening an office in Abu Dhabi.
Hedge fund managers have been expanding their presence in the Middle East in an attempt to win local business and forge ties with sovereign wealth funds in the region. The lure of low taxes has also attracted them to Abu Dhabi and Dubai. The majority of them are London or New York-based funds opening subsidiaries.
The pandemic helped Dubai and Abu Dhabi position themselves as attractive alternative cities to London, New York and Hong Kong. Hedge fund managers said they experienced an increase in relocation inquiries during government-mandated lockdowns in Europe and the US, reflecting how Dubai’s Covid restrictions were much less harsh compared with traditional hedge fund centres. In addition, Abu Dhabi has been trying to make itself a hub for blockchain technology.
Since Marshall Wace was founded in 1997 by Paul Marshall and Ian Wace, it has carved out a position as Europe’s answer to US industry giants Citadel and Millennium. Its assets under management have grown to a record $65bn, bucking a trend that has seen many of the region’s equities hedge funds largely retrench.
Founder Marshall’s Eureka fund, which accounts for about a third of the firm’s assets, is up about 8 per cent this year, according to investors. The remaining two-thirds of its assets are run in systematic strategies that use computer algorithms, about a third of its 575 or so employees work in technology-related roles and the firm spends tens of millions of dollars a year on tech.