As part of Deutsche Bank’s recent expansion initiatives for its overall prime brokerage business, the firm has launched a hedge fund consultancy.
Some of the more established prime brokers offer their clients consultancy in the shape of infrastructure advice but Deutsche is planning to go farther, catering to medium-sized and large hedge funds, in addition to start-ups. To head the business, the bank has employed John Budzyna in New York. Budzyna was CEO of hedge fund administrator Olympia Capital Associates, and before that was co-head of the hedge fund practice at Ernst & Young. He reports to Barry Bausano and Jonathan Hitchon, co-heads of global prime finance. Hitchon says: "Prime brokerage is becoming more and more commoditized, particularly in the areas of technology and settlement services. To make a difference to clients, and especially the larger clients, it is important to offer relevant intellectual capital."
Clients the business will serve range from emerging managers through to large hedge funds and traditional asset managers diversifying their business model into the alternative space via internal hedge funds, 130/30 structures and Ucits-type investment vehicles. Hitchon says: "Often the capital introduction space has been regarded as more like ‘speed dating’, and offerings tend to focus on setting up, and then little else is done as the hedge fund evolves.
