$18 billion hedge fund Magnetar plans to use hundreds of AI agents to fully replace human analysts

According to Beating Monitoring, the hedge fund Magnetar Capital, which manages $18 billion in assets, plans to launch a new fund later this year. During the research phase, human analysts will be completely shut down, replaced by hundreds of AI Agents that search for investment leads, analyze individual stocks, and predict trends. The final trading decisions will still be made by humans.

The new fund will not need a large number of researchers to carry out bottom-up fundamental research, and Magnetar employees’ responsibilities will shift accordingly to the development and maintenance of AI underlying systems. The system architecture was built by the AI quant lead Trevor Mottl. Mottl previously served as head of long/short equity risk at Balyasny, and was responsible for AI investments at Man Group and Walleye. The new fund’s strategy tilts toward going long and holding long term, allocating only a very small proportion of capital to capture millisecond-level trading signals.

The system’s reasoning layer serves as the command center, responsible for coordinating hundreds of intelligent agents to work together at different time points. The entire system runs on multiple NVIDIA servers, using high-density signal processing to filter out market noise and capture potential pricing patterns.

The quantitative hedge fund industry has recently seen similar attempts. Earlier this year, former Coatue investment manager Rahul Kishore launched a fund jointly managed by 3 human experts and an AI intelligence called Eve. However, the actual effectiveness of AI investing remains disputed within the industry. In a recent simulation test involving 8 frontier large models, most of the systems recorded losses.

Magnetar was founded in 2005 and mainly invests in alternative credit. The new fund is Magnetar’s first AI investment tool launched in the secondary market. Magnetar previously launched a venture capital fund focused on generative AI in 2024.