Multistrategy headcount growth slows to 7% as SMAs reach $47 billion

Headcount at multistrategy and multi-manager hedge funds increased 7% between mid-2025 and mid-2026, down from 10% growth in the prior year, according to Goldman Sachs research reported by Business Insider and covered by Hedgeweek on Oct. 23. That continues a slide from 18% in 2024 and 27% in 2023.

Goldman tied part of the slowdown to external allocation programmes, which let a platform deploy capital with independent managers instead of recruiting in-house teams. External assets under management at multistrategy firms rose from $34 billion to $47 billion over the past 12 months, a $13 billion increase Goldman says is equivalent to roughly 800 full-time employees. Counting that capacity, effective annual headcount growth would have been above 10%, broadly in line with the previous year.

An average external allocation of nearly $190 million is now a capacity number for fund selectors: a single SMA mandate can move a strategy's asset base. The average rose 19% year on year, which tells a selector what large platforms are already asking managers to absorb and how much transparency and control those platforms get in return for the mandate.

The research names Millennium, Schonfeld and Qube as firms that have expanded their use of SMAs, and says Citadel has begun exploring external allocations. The structures let portfolio managers launch independent firms with institutional capital.

Recruitment priorities have moved with it. Investment professionals accounted for 43% of hiring in 2026, up from 40% in 2024, as firms reduced recruitment for non-investment roles. The shift follows several years of competition for portfolio managers in which multistrategy firms offered guaranteed packages worth tens of millions of dollars. Hedgeweek reports that the findings suggest external programmes are beginning to ease hiring pressure across the sector, while competition for established portfolio managers remains significant. The open question for selectors is whether the SMA route keeps pulling talent out of platform payrolls, and what that does to the fee and capacity terms offered to outside managers.