LMR Partners to Set Up Office in Dubai

Ben Levine, Andrew Manuel, and Stefan Renold founded LMR Partners, a hedge fund management company with headquarters in London, with the goal of offering investors superior risk-adjusted returns by taking advantage of short-term market opportunities. LMR Partners seeks to take positions in a variety of macro and micro factors through its flagship investment strategy. According to the business, there are times when macroeconomic causes dominate the movement of global asset values and other times when asset-specific events take centre stage. By integrating macro trading with methodical equity long/short, it seeks to meet its investing goals in each of these contexts.
According to the report’s unnamed sources, the $9.8 billion London-based company has obtained a licence from the Dubai International Financial Centre and would initially staff its new office with six people. LMR is leasing space in the ICD Brookfield Place, sharing space with Balyasny Asset Management, which last week announced plans to open a Dubai office. The LMR space has room for 25 to 30 people.
The remainder of the LMR team in Dubai, including portfolio managers Iain Raskin and Sebastian Gorga from Hong Kong, will relocate from other offices. Half of the team will be new hires. For some of its portfolio managers who conduct international trading, LMR apparently considers the emirate to be a more practical time zone.
According to the official register of the financial centre, other well-known firms including Brevan Howard and Squarepoint Capital LLP have also recently secured licences to operate in the emirate, suggesting that LM may not be the last hedge fund to establish a presence in Dubai.
LMR has joined Izzy Englander’s Millennium Management and Michael Gelband’s ExodusPoint Capital Management in expanding into Dubai. LMR’s traders invest in a variety of strategies and asset classes, including equities and fixed income. Dubai is quickly becoming a preferred location for international financiers, who are enticed by its tax-free status, ease of conducting business, and attraction as a centre for international travel. Additionally, it is a more accommodating time zone for portfolio managers with international investments spanning Asia to North America.
With a licence to operate in the International Finance Centre (DIFC) as of 2020, Izzy Englander’s hedge fund company, Millennium Management, now employs about 30 people in Dubai. Meanwhile, All Blue Capital reorganised its former London headquarters to base its global operation in Dubai with nearly half of the company’s global staff now based there.
While Brexit has prompted some funds to look for new bases outside of the City of London, the DIFC has also introduced a number of incentives designed to increase Dubai’s appeal. These include reduced licencing fees and capital requirements for hedge funds domiciled a domestic fund. Currently, $450 billion worth of assets are managed by companies domiciled in the DIFC.
Given the emirate’s good infrastructure, low taxes, and lax regulations, more hedge fund managers are choosing to move to Dubai, according to Dominic Volek, the head of private clients at consultancy Henley & Partners in Dubai. Henley & Partners anticipates the UAE will attract a net inflow of 4,000 millionaires this year, the most of any nation in the world.
A second draw is higher oil prices. The Gulf region’s sovereign wealth funds are investing the windfall at home and abroad as a result of crude prices that are hovering above $90 per barrel and boosting regional economies and stock markets.
Schonfeld Strategic Advisors, a New York-based investment business, expanded to Dubai last year, while All Blue Capital abandoned its London base to establish a base there, where it now employs about half of its global workforce. According to the official registry of the finance hub, several well-known funds, like Brevan Howard and Squarepoint Capital LLP, have also recently acquired licences to operate in Dubai.
LMR now has six offices worldwide with about 190 employees. LMR already has locations in London, Hong Kong, New York, Glasgow, and Zurich.
Several multinational corporations are attempting to expand their presence in the Middle East, including Habib Bank Zurich. A new branch will be opening in DIFC, according to a statement made last month by the global bank with its headquarters in Switzerland.
A targeted platform for wealth preservation and legacy planning will be made available to clients at the new site.
According to the Dubai International Financial Center’s official record, the massive UK hedge fund Brevan Howard successfully formed Brevan Howard Investment Products Ltd with the DIFC on October 18. In June of this year, Squarepoint Capital, based in London, also registered with DIFC.
A representative for DIFC stated that the organisation has improved its services for hedge funds, including waiving registration fees and lowering capital requirements.
Hedge funds make up about 15% of our market for wealth and asset management. A significant portion of this company is made up of UK hedge funds.
The increasing number of wealthy residents in the area is providing prospects for hedge funds worldwide. Dubai is on course to rank among the richest cities in the world, claims a recent analysis by the London-based investment migration firm Henley & Partners. The city report stated that by mid-2022, Dubai would have 67,900 millionaires, making it the richest metropolis in the Middle East and Africa.
Capital investment is increasing significantly in Dubai. In the first nine months, the Emirate saw a 16% increase in investment projects, bringing in about $4.33 billion in foreign direct investment, according to the Dubai Investment Development Agency, a division of the Department of Economic Development in Dubai. The numbers are only expected to rise.
The largest international financial hub in the MEASA region, Dubai International Financial Centre (DIFC), according to Ali Hassan, senior representative for Europe and North America, “private wealth is where we are seeing genuine growth.” Hedge fund portfolio managers travel to Dubai to make investment choices. For them, Dubai is the destination where talent wishes to settle in order to benefit from the alluring business climate and take advantage of the city’s top-notch lifestyle options,” he said.
Although sophisticated sovereign wealth funds have always existed, the current state of affairs is marked by a significant increase in private wealth, Private wealth has typically been kept in assets like money, real estate, and physical companies. The amount of assets under management has significantly increased as a result of the increased investment of this cash in financial markets.
The market for alternative assets is very active in Dubai, which is a wonderful place to raise assets. The significance of their fixed income methods for regional clients is being recognised by venture capital companies and asset managers, who also see that they can accomplish more in the region if they have a more substantial presence.
The link between “what you do” and “where you do it” was broken by the Covid epidemic, therefore the work climate now allows for more freedom. Businesses mentioned the luxury of luring talent to the most desired areas. With improved visa programmes like the five- and ten-year Golden Visas, the UAE government is very supportive and enables managers of hedge funds to draw in and keep top talent.