The$Hedge$Fund$Industry$in$ConnecticutFebruary$2016

Prepared$by$The$Connecticut$Hedge$Fund$Association,$with$assistance$from$the$Greenwich$Chamber$of$Commerce

The$Global$Hedge$Fund$Industry

Global$Hedge$Fund$Industry

• $3tn$in$AUM

• $355bn$added$in$2014

• +764$new$funds$created$in$2014

• F260$funds$closed$ in$2014

• 3$out$of$every$4$$$is$now$from$institutions

• China$Investment$Corp.$is$largest$HF$investor$in$AsiaFPacific$region$($26bn).

Global$Hedge$Fund$Industry

61%21%

14%4%

Breakdown$of$Managers$by$Location

North$America

Europe

AsiaFPacific

Rest$of$World

Global$Hedge$Fund$Industry

Manager$Headquarters Assets$under$Management$($bn)North$America 1,923

Europe 560

AsiaFPacific 112

Rest$of$World 69

Hedge$Fund$Assets$by$Regional$Location

Global$Hedge$Fund$Industry

Manager$Country$Location Assets$under$Management$$($bn)US 1,893

UK 440

Brazil 51

Hong$Kong 47Sweden 39

France 34

Australia 33

Canada 26

Switzerland 25

Singapore 21

Breakdown$of$Hedge$Fund$Manager$Assets$by$Country$Location

The$US$Hedge$Fund$Industry

The$US$Hedge$Fund$Industry• Started$in$1949$with$A.W$Jones$in$New$York.

• Home$to$8,500$hedge$funds,$managing$over$$1.7tn$(over$70%$of$the$global$hedge$fund$industry).

• 46$of$the$50$states$have$some$hedge$fund$activity.

• 95% of$US$hedge$fund$assets$managed$from$10$leading$states.

• 40% of$USFbased$hedge$funds$are$in$New$York

• 55% of$all$institutional$ capital$invested$in$hedge$funds$globally$ is$from$USFbased$institutional$ investors.

The$US$Hedge$Fund$Industry

Number$of$USFBased$Hedge$Fund$Managers$and$Hedge$Fund$ Investors$by$State

The$US$Hedge$Fund$Industry

AUM$of$US$Based$Funds$of$Hedge$Funds$by$Manager$State

New$York

Connecticut

Illinios

California

Penn

Texas

Washington

Virginia

Florida

NY

CT

The$US$Hedge$Fund$Industry

State AUM$($bn)New$York 838

Connecticut 334California 155

Massachusetts 128

Illinois 76

Texas 53

New$Jersey 36

Minnesota 31

Florida 22

Penn 7

Hedge$Fund$Industry$Trends$&$Challenges

• Institutionalization$(3$of$every$4$dollars$invested$is$now$from$institutions).

• Regulation$(SEC$registration$and$AIFMD$in$Europe).

• Largest$hedge$funds$attracting$most$of$the$assets.

• Liquid$alternatives

Connecticut’s$Hedge$Fund$Industry

Connecticut’s$Hedge$Fund$Industry• At$$334bn,$CT$has$the$second$largest$hedge$fund$industry$in$the$US.

• CT$is$the$third$largest$center$for$hedge$funds$globally$by$AUM,$behind$only$New$York$and$the$UK.

• Proximity$to$New$York,$a$more$favorable$tax$regime$compared$to$New$York$or$New$Jersey,$and$quality$of$life$makes$CT$an$attractive$location.

• The$hedge$funds$in$Greenwich$and$the$surrounding$towns$(especially$Stamford)$represent$an$“industry$cluster”.$$

• There$is$a$larger$business$ecosystem$that$has$grown$up$to$service$the$hedge$fund$firms.$$These$service$firms$include,$investment$banks,$law$firms,$accounting$firms,$fund$administrators,$custodian$banks,$technology$firms$and$more.

• The$Connecticut$Hedge$Fund$Association$was$established$in$2004$and$now$has$over$4,000$individual$members.

Connecticut’s$Hedge$Fund$Industry

Firm City/Town AUM$($bn)Bridgewater Associates Westport 151.5

AQR$Capital$Management Greenwich 24.9

Viking$Global$Investors Greenwich 18.2

Three$Largest$ConnecticutFBased$Hedge$Fund$Managers$by$Assets

Connecticut’s$Hedge$Fund$Industry

Sample$List$of$Connecticut$Hedge$FundsAQR$Capital

Bridgewater$Associates

Chilton$Investment$Co.

Discovery$Capital

Ellington$Management

K2$Advisors

Lone$Pine$Capital

Tudor$ Investment$Company

Viking$Global

Town$of$Greenwich

Greenwich:$Overview

• Settled$in$1640.

• Located$within$Fairfield$County,$Connecticut

• Population$of 61,000,$with$an$average$density$of 930/mi2 (360/km2).

• Area$of 48$square$miles.

• Located$30$miles$northeast$of$New$York$City.

Greenwich:$Transportation

• Located$30$miles$northeast$of$New$York$City.

• 2$interstate$highways.

• 3$airports$service$Greenwich.

• Metro$North$commuter$rail$from$and$to$NYC.$(less$than$50$minutes$travel$time)Fimportant$for$younger$reverse$commuters.

• Four$train$stations.

Greenwich:$Quality$of$Life• 32$miles$of$coastline.$$A$boater’s$haven.

• 20$parks.

• 11$elementary$schools,$3$middle$schools$and$1$punlichigh$school;$six$private$schools.

• 14$private$clubs.

• Fabulous$shops$and$restaurants$on$Greenwich$Avenue.

• Numerous$cultural$options$including$Greenwich$Symphony,$Greenwich$Choral$Society,$Bruce$Museum$and$local$art$galleries.$

Greenwich:$Taxes,$Real$Estate$&$Business

• State$income$tax:$$Top$personal$income$tax$rate$of$6.7%$(vs.$8.9%$in$NYC)

• Greenwich$property$taxes:$$Greenwich$property$tax$rates$are$11.31$(mills).$$Property$taxes$in$Greenwich$are$some$of$the$lowest$in$the$state.

• 4,805,432$square$feet$of$Class$A&B$office$space.

• Average$rent$(Class$A)$is$$66.73

• Over$6,000$diverse$businesses;$including$one$of$the$worlds$largest$concentration$of$hedge$funds,$earning$Greenwich$the$nickname$“hedge$fund$capital$of$the$world”.