By Nishant Kumar and Dinesh Nair | Updated on Jun 11, 2026 at 01:40 PM
An Abu Dhabi-based investor is considering building exposure worth $15 billion with global hedge funds, people familiar with the matter said, an outlay that will mark one of the emirate’s most significant forays into the sector.
Abu Dhabi Investment Council is working with local banks to allocate to hedge funds using a so-called total return swap facility that allows it to supercharge its capital by use of leverage, the people said asking not to be identified because the details are private.
The unit of Mubadala Investment Co. is primarily targeting multistrategy firms that have produced steady positive returns in recent years, but will consider other strategies, the people said. The firm was recently among investors backing a $2 billion capital raise by Michael Gelband’s ExodusPoint Capital Management, Bloomberg News has reported.
Read More: ExodusPoint Raises $2 Billion With Abu Dhabi Fund Among Backers
“Hedge Funds have consistently performed well within ADIC’s portfolio and have demonstrated their ability to generate steady returns through both favorable and challenging market conditions,” said Shiv Srinivasan, chief investment officer for hedge funds at the fund. “We continue to see value in strategies that can provide diversification, downside protection, and attractive risk-adjusted returns across market cycles.”
The use of total return swaps signals ADIC’s desire to rapidly ramp up exposure to hedge funds. Under such facilities, one party pays a fee in exchange for receiving the full economic return of an asset, while also bearing the risk of losses without taking legal ownership of the asset. These arrangements can include substantial leverage, meaning losses can potentially mount far faster than in a conventional investment.
The plans indicate growing appetite to deploy with hedge funds in the region, which has also become an emerging hub for the sector. The biggest firms, from Millennium Management to Brevan Howard Asset Management, have expanded to Dubai and Abu Dhabi in recent years, drawn by advantages including deep pools of sovereign and private capital.
That includes the likes of Saudi Arabia’s Public Investment Fund and Abu Dhabi Investment Authority, which has ramped up its use of separately managed accounts to deploy large chunks of money across dozens of firms.
Under Chief Executive Officer Saeed Al Mazrouei, ADIC is breaking from its low-profile past and pushing into newer ground across its $160 billion portfolio. The fund has launched a secondaries business — now staffed by 12 professionals with ambitions to deploy up to $10 billion over three years — while simultaneously deepening exposure to Bitcoin, private credit, insurance and hedge funds as it targets returns of at least 10%.
Read more: $160 Billion Abu Dhabi Fund Eyes Bolder Bets for 10% Returns