Do Hedge Funds Contribute Positively to the Job Market?

August 10, 2012 James Heinsman Quote of the Day

President of HFA Mitch Ackles

As the public continues to scrutinize, regulate and analyze the hedge fund financial sector one question that is being asked is whether the growth of the hedge fund industry will contribute to the number of jobs available, furthering the growth of the economy.

According to Mitch Ackles,  President of the Hedge Fund Association as well as the CEO of Hedge Fund PR, hedge funds do indeed add to economic stability and growth in several ways, including by adding jobs.

"Hedge fund startups are bringing in traders and people that can manage the trading aspect of the business," Ackles said. "It's different for each hedge fund at each inflection point. If you're a startup hedge fund and you're coming out of the gate with $50 million, you might be able to succeed and do that with four people. You might have two traders, one operational person, and a receptionist, and then outsource other aspects of your business."

And if you think outsourcing is a dirty word because of the bad reputation it got from companies that send work to low wage countries, thus taking jobs away from Americans, Ackles says no, outsourcing definitely leads to more jobs.

"You already have to outsource your administrator," he said. "And you have to outsource your technology provider. So there are a lot of aspects that you can outsource nowadays. Even compliance can be outsourced. But as you grow, you become more like a financial institution."

Even though hedge funds start small with few people, they tend to grow if they succeed.

"You grow and then you have a marketing department; you have people that work directly with the investors; people concerned with the brand identity of the firm; you have a compliance army; you have internal counsel and external counsel; and obviously you've got almost a trading room that you would see at a prop desk at a bank," Ackles added.
 

Economy, Hedge Fund Association, Hedge Fund PR, job market, Mitch Ackles,

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