Navigating Wealth Hedge Funds Aren't Dead: They Know Something You Don't - Megan Nicholson
Apr 1, 2026
Megan Nicholson, co-founder of ImageArb and two-decade hedge fund capital-raising veteran, explains how hedge funds work and why AUM recently hit $5 trillion. She breaks down net exposure, leverage, and hedging across strategies. She covers what allocators look for, why repeatable processes beat peak returns, and how access and intelligence gaps challenge high-net-worth investors.
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Sharpen Your Deck Before You Beautify It
- Do refine and articulate your fund's unique content before design; allocators need a crisp explanation of what makes you different.
- ImageArb runs discovery pitches and often rewrites decks word-for-word to align messaging with allocator questions.
Polite Rejection Of An Ill-Fitting Hedge Fund Idea
- Megan told Tad and his cofounder their hedge fund idea was probably not a good fit after their software exit.
- Tad reports everyone of their investors made money, but they weren't well suited to run an investment fund long-term.
Hedge Funds Grew To $5 Trillion In 2025
- Hedge fund assets reached over $5 trillion in 2025 with $116 billion of inflows that year, contradicting the perception that hedge funds are in decline.
- Megan Nicholson cites Barclays data and notes institutional interest concentrated in discretionary equities, niche sector funds, and multi-manager platforms.