MM Mkt Neutral - External funds under the umbrella?
I came across a team working in a MM platform (one of the top 4 names) that has its own fund "name" or at least it has a registered corporation as if it were independent. The PM has quite a long track record (successful I'd guess).
How does it work? There are funds managed independently by PM that are though under the MM platform? Does it mean that the strategy is their own and not necessarily mkt neutral as being part of such a MM would imply?
I thought pods were all there working independently yes but still for the same institution (so subject to same rules in terms of risk, etc.).
One reason is so you don't have 5 analysts in every group meeting with their name tag reading "MM firm name"
Other cases include the MM firm seeding some PMs and allowing them to take outside capital, operate as standalone entity. Some of these cases have gone on to become independent firms in their own right, others found it difficult and folded back into the MM but kept their outside name, etc. Lots of ways it could go, but I imagine the tighter they are tied to the MM (i.e. no outside money) the more similar their risk constraints will be.
Most of it is just branding. Very few actually build a track long enough to raise external capital. And the mm wants rofr on capacity anyways.
they’re run just like any other pod - pods have to rm the sht outta pms or else the model breaks.
The best part is when they try to sell you on the unique opportunities of each "pillar". "So and so founded it from XYZ background so we have a (insert whatever they think you want to hear) as a differentiator."
No. You're all the same, confirmed by like 15 independent people in the industry with first-hand experience.
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