British hedge fund, Marshall Wace to open Abu Dhabi office

Marshall Wace plans to open an office in Abu Dhabi in the coming months, according to Financial Times. This move would make it the latest hedge fund manager to establish a presence in the United Arab Emirates. The objective is to be closer to the Middle Eastern investor base and to better compete for talent, according to the report. The Gulf states are promoting themselves as financial centers with attractive regulatory and tax regimes and a growing talent pool.

Marshall Wace, managing approximately $65 billion in assets, would join other hedge funds like Chris Hohn’s TCI and macro fund Brevan Howard in opening an office in Abu Dhabi. Brevan Howard now manages more money from Abu Dhabi than from London or New York. Other funds such as Izzy Englander’s Millennium, Steve Cohen’s Point72, and quant investing giant AQR have chosen Dubai to establish a regional presence. Both cities benefit from their strategic positions, bridging the European and Asian trading days.

Hedge fund managers are expanding their presence in the Middle East to secure local business and form connections with sovereign wealth funds in the region. The appeal of low taxes has also drawn them to Abu Dhabi and Dubai. Most of these funds are based in London or New York and are opening subsidiaries in the region.

The pandemic boosted Dubai and Abu Dhabi’s appeal as alternatives to London, New York, and Hong Kong. Hedge fund managers reported increased relocation inquiries during the government-mandated lockdowns in Europe and the US, as Dubai’s Covid-19 restrictions were less stringent. Additionally, Abu Dhabi is positioning itself as a hub for blockchain technology. Since its founding by Paul Marshall and Ian Wace in 1997, Marshall Wace has emerged as Europe’s counterpart to US industry giants like Citadel and Millennium.

The firm's assets under management have soared to a record $65 billion, bucking the trend of many regional equities hedge funds facing pressure. Founder Marshall’s Eureka fund, which represents about a third of the firm’s assets, is up about 8 percent this year, according to investors.