A recent report by London-based IG Prime praised the growing influence of Dubai and Abu Dhabi in the hedge fund industry, which has now exceeded a global size of $4.5 trillion. The UAE has become a “magnet” for hedge funds and financial institutions, with a growing number of top global firms such as Millennium and Balyasny opening regional offices in the country.
According to the report, the Dubai International Financial Centre (DIFC) had attracted around 60 hedge funds by September 2024, while the Abu Dhabi Global Market (ADGM) is also advancing rapidly in the same direction. This growth is attributed to the UAE’s proximity to allocators, in addition to its tax advantages, favorable time zone, and high-quality lifestyle.
The report also noted that these “lightly regulated” financial hubs are reshaping the global investment landscape and may push other regulators to reassess the impact of their current rules.
One of the biggest shifts in the sector is hedge funds moving into private markets—such as private equity, private credit, real estate, and infrastructure. Around 70% of hedge funds now invest in private markets, creating direct competition with private equity funds.
Although high interest rates made 2024 a challenging year for private equity, private credit continued to grow strongly due to declining bank lending, positioning it as a key financing alternative.
In short, the report shows how the UAE has become a major player in the future of hedge funds—not just as a strategic location, but as an advanced financial hub that is redrawing the map of global investment.
