Ten multistrategy funds hold $2.2tn gross on $360bn net

Ten multistrategy hedge funds held about $2.2 trillion in gross assets, including borrowed capital, against $360 billion of net assets at the end of 2025, according to PivotalPath research reported by Hedgeweek. That is roughly six times investor capital and more than triple the group's gross exposure in 2018.

Leverage was heaviest at the six multimanager platforms that run multiple investment pods, which carried between eight and 14 times their net capital, PivotalPath found. The gap between $2.2 trillion of gross and $360 billion of net implies roughly $1.8 trillion of borrowed capital.

For allocators, the leverage level turns due diligence on the largest platforms into a question of lockup length measured against the fund's 8x to 14x net capital. A fund running that much leverage has a thin equity cushion, so a given market move becomes a much larger move in what investors own. PivotalPath's shock scenario lands hardest on leveraged managers with concentrated books and shorter redemption periods, where investors can ask for cash while positions are still crowded. Multi-year investor lockups are the buffer PivotalPath cites against forced selling.

The ten firms' US equity holdings overlap more with one another than with other hedge funds, and returns across the group have been more correlated since 2019, the research found. PivotalPath said the findings do not indicate an imminent market disruption. The risk it describes is a simultaneous shock reaching managers that are both leveraged and concentrated, which could amplify selling pressure and create liquidity problems.