This report does not constitute a rating action. The ecosystem of proprietary trading firms, hedge funds, and other market participants has expanded rapidly over the past five years. As of third-quarter 2025, global hedge fund assets under management had surpassed $5 trillion, while rated proprietary trading firms--including market leaders Jane Street, Citadel Securities, Hudson River, and IMC--generated about $40 billion in revenues in 2024. Growth accelerated further in 2025 and nonbank trading firms now play a significant role in markets ranging from sovereign debt to equity options. These banks help finance inventories, provide leverage, and manage post-trade clearing through markets financing. Prime brokerage lending to hedge funds approached $2.5 trillion in 2024 in the U.S. alone, doubling over a four-year
