Dubai is the new global hub of hedge funds and of alternative investments. This is supported by the report entitled "Dubai: The next global hedge fund center - opportunities and outlook" published by Dubai International Financial Center (DIFC), in collaboration with Refinitiv, according to which the growth and growing role of Dubai as a global hub for hedge funds and alternative investments. “DIFC is currently driving this growth and is in talks with more than 60 global hedge funds who are seeking to establish offices within the Centre,” the report reads.
Dubai: data from Difc
In 2022, the Dubai International Financial Center recorded a 54% increase in the total number of hedge funds who have settled in the center, "where there is already a solid base of consolidated companies", certifies the analysis. About two-thirds of DIFC-based hedge funds are from the United States and the United Kingdom, including two of the ten largest hedge funds in the world.
Arif Amiri, CEO of the DIFC AuthorityHe said: “DIFC's remarkable growth contributes significantly to the Dubai Economic Agenda (D33) goal of transforming Dubai into a top three business city in the world. It is encouraging to see that we are attracting the attention of international hedge funds, with a record number of registrations in 2022, up 54% from the previous year, with more planned. This reflects Dubai's and DIFC's ability to keep pace with global economic changes and provide an ecosystem for the financial sector that offers new growth opportunities."
“Several hedge funds have already begun to expand into new emerging markets, as operating conditions in their home markets become increasingly challenging. Furthermore, long-established markets no longer offer growth prospects or cost efficiencies that rival those available in emerging hubs. Hedge funds are showing growing interest in Dubai as a gateway to the region, looking to establish a presence in DIFC – a rising global hub for alternative investments and hedge funds,” he said Nadim Najjar, managing director of Central & Eastern Europe, Middle East & Africa Refinitiv, an LSEG company.
Assets under management of 4,8 billion
According to data from BarclayHedge, hedge funds have demonstrated good resilience in a challenging global environment, with global assets under management (AuM) exceeding 4,8 billion dollars at the end of 2022, an increase of 1% compared to the end of 2021.
DIFC ranked among the top 15 financial centers in terms of index sub-indicators related to government and regulation, professional services and business environment.
“As Dubai and the DIFC continue to attract financial players from around the world, including hedge funds looking for new places to establish their operations, they in turn benefit from access to the growing retail and institutional wealth of the region, since that the UAE recorded the highest net inflow of millionaires in 2022, according to the Henley Private Wealth Migration Dashboard,” the report continues. It is estimated that the private wealth in the country amounts to US$966 billion and that the number of high net worth individuals (HNWIs) is projected to grow by 40% by 2031.
