How does 26 Degrees support Emerging Hedge Fund Managers?

Interview Topics:

1. What are the biggest challenges for emerging hedge funds?
2. What makes emerging hedge funds such a core focus for your business?
3. What do emerging hedge funds need most from a service partner?
4. What are main barriers to access you help emerging hedge funds overcome?
5. How do 26 Degrees ensure their platform evolves alongside their clients?

Q1: In recent years, how has the environment changed for emerging fund managers, and what are the biggest challenges they’re facing today? 

The environment for emerging managers has become significantly more challenging over the past 5-10 years. Not because of a lack of talent or performance, but because the structural support around them has thinned out. 

Many of the large investment banks that once dominated the prime brokerage market have pulled back, driven by rising regulatory complexity and the commercial pressures of servicing smaller clients. The result? Many emerging funds have been left without the full package of market access, infrastructure, and institutional-grade support they need to scale. 

At the same time, larger funds have greater resources to meet operational requirements, secure Tier 1 relationships and build out capital-raising functions. Even for an emerging manager delivering strong returns, competing for mandates against multi-billion-dollar peers can be an uphill battle. 

Q2: While many providers have stepped back, 26 Degrees has gone in the opposite direction. What makes emerging managers such a core focus for your business?  

Emerging managers are a vital component of the broader investing ecosystem. They tend to operate with sharper focus and a willingness to explore strategies that fall outside the norm. Often, this means operating in areas of the market that larger funds overlook, offering uncorrelated approaches that institutional allocators increasingly value for their ability to diversify portfolios and improve risk-adjusted returns. 

But while the demand for differentiated ideas is growing, the structural support needed for emerging hedge funds to scale has diminished. That’s where we believe 26 Degrees can play a meaningful role. 

We’ve made a deliberate choice to step into that gap, not as a short-term fix, but as a long-term partner. Many of today’s most successful managers started small, and we’re here to back the next generation early and stay with them throughout their journey. 

Q3: What do you think emerging managers need most from a service partner, and how do you aim to deliver on that? 

What emerging managers need most is a partner who’s tuned into the specific needs of their business. That’s the philosophy behind our high-touch model, which focuses on delivering a level of service that’s consistent, thoughtful, and tailored to the way each client operates. This mindset was recently recognised at the HFM Asia Services Awards, where we were named Best Prime Broker – Client Service. 

With offices in Sydney, London, Tokyo, and Limassol, we provide complete global coverage, ensuring our clients are supported across time zones and all market trading hours. For emerging managers who don’t operate a 24-hour trading desk, that presence can make a material difference. 

Our outsourced trading service builds on that foundation. It’s designed to reduce the operational burden on emerging hedge funds, while providing the tools, experience and technology needed to scale with confidence. 

The desk includes 15+ experienced traders supporting execution across Equities, FX, and Futures 24/6. With our headquarters in Sydney, clients benefit from coverage that naturally extends beyond the US close, which can be especially useful for FX settlement. The service also provides access to advanced trading technology and real-time risk monitoring, giving managers the oversight they need to stay in control, and the breathing room to stay focused on their investment strategy. 

Q4: For emerging managers aiming to operate at an institutional level, what are some of the key barriers to access you help them overcome? 

For emerging hedge funds managing smaller AUM, one of the biggest early hurdles is access – both to prime services and to capital. Without the right institutional set-up, it becomes significantly harder to scale. That’s where 26 Degrees can help. 

On the pricing and execution side, we have established relationships with a panel of Tier 1 global investment banks, including JP Morgan, NatWest, Standard Chartered, and Cantor Fitzgerald. These relationships give our clients access to global equity, foreign exchange, precious metals, index, and commodity markets. For emerging managers in particular, they help remove the key barriers to institutional trading and execution, making it easier to operate with scale early in the fund’s lifecycle.  

On the capital raising side, we run a Capital Introduction program that’s purpose-built to support emerging managers. We work closely with clients to understand their strategy, story, and goals, then facilitate introductions to our broad network of allocators actively looking to invest in early-stage or differentiated funds. This includes single-family offices, multi-family offices, endowments, and asset managers across key global markets. 

Our approach is informal by design – focused on long-term partnership rather than one-off meetings. We’re selective and intentional with how we make introductions, aligning managers with allocators whose objectives and risk appetite match their strategy. 

Q5: As your clients grow and evolve, how do you ensure your platform grows with them? 

As I mentioned earlier, we’re here to support the next generation of funds and stay with them throughout their journey. That means as our clients evolve, we’ll continue to evolve with them. We’re always looking at where we can expand our offering – whether that’s through product range, market access or technology capabilities. 

What doesn’t change is the level of support. As trading demands grow more complex, clients still get the same level of responsiveness, attention to detail, and partnership they had from day one. 

If you are interested in finding out more about 26 Degrees’ full-service prime brokerage solutions, get in touch.