Chicago is a city in its own rite. Not exactly the financial capitol that New York is, but definitely spreading its wings to become a serious second.Future financial managers come from all over the world to train and learn their craft from Citadel CEO Ken Griffin. They garner clients, learn the ropes and become proficient in their field.
These financial wiz kids then break free from the chains of their bosses and go off on their own. They have quickly developed a network of experience and expertise that is offering serious competition to New York and the other financial markets around the world.
Citadel is showing itself to be a mega fund of exceeding proportion. It has more than $26 billion in its ranks and seeks to continue to add to this amount. It is also setting the sights for any competition very high. The next largest hedge fund in Chicago controls $13 billion.
Citadel alone controls 70% of the funds in the hedge fund market. This may be impressive, but recovery since the recession has led to slow gains in profits and monetary funds to this sector of the market.
As the blog Left Handed Right Mind quickly points out, as funds are slow to trickle back into the hedge fund market, oversight and scrutiny by the authorities is not. An increasing number of regulations and rules have flowed iinto the control and operation phases of the market.
Managers in the Chicago market are forced to spend more per capita on adhering and staying within the dictates of the new regulations placed upon them. This equates to them not quite being the big players in the larger hedge fund pool. This does not stop them from being in the race though.
What their smaller status equals is a definite opportunity to attract greater talent that can make the sweeping changes to be a definitive competitor for the New York based firms. New York also has the advantage of being in the field with over 1100 firms at its base. Chicago is operating with only 193 firms within its confines.
This also leaves the New York firms with more opportunity to raise and garner not only funds, but more funds than the Chicago market can. No need for worry though, the Chicago looks at this dilemma as their advantage for growth. The larger New York market has reached its full potential. Chicago has not. That means Chicago only has the option to grow and become a serious player in the market.