Brexit Might Spur Hexit

July 7, 2016 James Heinsman In the News

The decision of Britain to leave the EU has left uncertainty and confusion in its wake. This is especially true of financial firms, such as hedge funds, which rely heavily on the opportunities investing in the unified marketplace of Europe afford.

A survey done by the research group Preqin tried to gauge the reaction of alternate asset managers to the British decision to exit the EU. They asked 142 such firms and found that 7 percent are considering a move out of Britain. An additional 17 percent have not yet decided if a move would be a good idea or not.

London has always been a popular city to headquarter hedge funds and private equity groups interested in trading in the European marketplace. Managers are worried that if the UK ends up leaving the EU without making a deal in which they can easily participate in the single market of Europe, that they will have compromised their businesses.

Head of executive reward for Europe at Hay Group Carl Sjostrom, said a large number of alternative asset managers were thinking about expanding their presence in the EU so that they can continue distributing funds in Europe.

“It is probably healthy for asset managers to be broader in their marketing efforts. They have relied too much on [investors] coming to London with their money. I think Brexit will dampen the London marketplace so British firms need to become more agile and innovative,” Sjostrom said.

Brexit, Carl Sjostrom, EU, Hay Group, Preqin,

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