Running a Private Equity and Hedge Fund Strategy Under One Roof.
Sorry if this is retarded lol. Was watching Suits and came across "Sidwell Investment Group" -
When I watched suits as a kid I had no knowledge of Finance but now as an incoming analyst watching it I realised how retarded suits was in general when it comes to finance. My little bro asked me if Sidwell was a PE firm or a Hedge fund. From what I gathered it is a little both no?
This got me thinking...
I was wondering would it be legally and from a compliance side of things to run a firm that does L/S Equities and MM. PE specifically and if this is possible in real life. If it they do exist, any reputable firms that do this as an example?
Do they not exist due to being like 2 distinct fields and having them under the same roof would be problematic in the sense of maximising returns?
Let me repeat, I know this sounds retarded but would be intresting to hear nonetheless.
- ChadrickBasedman
Yes, these funds exist (in different flavors). They're typically referred to as "crossover" funds. Tiger Global is the marquee example-- they do l/s equity and private VC investing. Third Point does the public + VC combo, too. Other firms, such as Hill Path, do publics + more traditional private equity. If I'm not mistaken, these funds can be structured so that investors can access both through one vehicle or pick and choose what they want exposure to (exact structures will vary by fund). These strategies certainly aren't ubiquitous, but they're also not that uncommon. (note: I've never seen Suits, so I can't confirm whether these funds are similar to what you're referring to / is portrayed on the show)
Thanks for the reply. Pretty much hit the nail on the head.
Say after like 10 years in IB/PE, me and a couple buddies (One in AM and 2 at L/S HFs) come together to start a firm up that does L/S and then after being established as a L/S for a number of years, we then start investing in VC/LMM PE - How much inital capital would we need to open up the VC/PE arm. I know this is probably never going to happen but would be intrested in a hypothetical figure.
There's no concrete answer to this-- just keep working hard until you're a successful investor and LPs are begging to give you money. Or just ask Chase Coleman how much he started with when you're interviewing at Tiger. Best of luck.
I was too busy looking at Donna, sorry bro.
Mommy*
Nah bro I was looking at Louis Litt mudding
The existence of some types of Structured Equity shows that any contraption could hypothetically-exist (don't know if that makes sense)
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