Opalesque Exclusive: As investment firms cut back on services to hedge funds Lighthouse Financial Group looks to fill void with the launch of a multi-service pr

Alternative Market Briefing

Opalesque Exclusive: As investment firms cut back on services to hedge funds Lighthouse Financial Group looks to fill void with the launch of a multi-service prime brokerage

Thursday, March 12, 2009

From Kirsten Bischoff, Opalesque New York:

New York-based Lighthouse Financial Group has announced the launch of Lighthouse Prime Services. On the heels of news that the larger investment banks will be cutting many services to hedge funds which have underperformed or decreased in asset size over the past months, Lighthouse is one of the prime brokerages looking to step in and cater to funds with a myriad of services.

Prime brokers which are looking to cater and build upon those funds deemed too small by the largest investment firms may be a sign of a larger industry trend as hedge funds split into two distinct groups (multi-billion dollar funds and then everyone else).

“It remains to be seen what the hedge fund industry will look like,” a Lighthouse representative told Opalesque. “It is a dynamic and rapidly evolving industry. What we do know is that there is tremendous value out there in nearly every asset classes and overall the industry - regardless of the size of managers - will do quite well. That being said, the cost of running a fund has increased and smaller funds will rely more on their core service providers to help them. We are committed to offering a comprehensive platform to assist small and mid-sized funds grow their business.”

The firm’s expansion into the prime brokerage space is being led by group co-head’s Jamie Caputo and Brian Stutman. Both Caputo and Stutman were previously at RBC where they were key players in the company’s prime brokerage rollout to the United States.

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