Prime brokers revamp to survive as their clients thrive

The good news for prime brokers is that their clients are thriving. At the end of the second quarter this year, hedge fund assets topped $2.2 trillion, according to Hedge Fund Research. More than 300 hedge funds were launched in the first quarter of the year, taking the estimated number of hedge funds and funds of funds to 9,647 – just shy of 2007 levels.

The bad news is that although there are more managers, fewer are using leverage and fewer are trading.