= Top Rated			= Commended
= Best In Class		= Unrated		= Not Rated

Merlin Securities Merlin is the firm the major prime brokers love to hate. It services a growing group of funds (the client base has doubled in size in the last year) both large and small, and relies on Bear Stearns for clearing and securities lending, but, nevertheless, returns scores which are well ahead of the survey averages in every service area. “They are great to deal with and we would be happy to refer Merlin to any fund,” writes a client. The only score that slips below “very good” is capital introductions, which is, nevertheless, up substantially, and attracts a flattering verdict from one user. “Although Merlin currently provides limited cap intro services they are actively building that capability now,” he writes. “We are supportive of their efforts to provide a fair, process-oriented approach … Our criticism of other prime brokers has been that cap intro is touted as a strong capability but was disappointing when we attempted to utilize it … yet [hedge funds] are paying for it anyway in the fee structure.” Merlin secures its best scores in technology and reporting. This is not surprising. The quality and openness of its platform, which not only enables hedge funds to monitor their portfolios in real time but facilitates multiple prime brokerage, is the chief competitive advantage of the firm. Merlin is also smart enough to recognize the advantages of making the reporting capabilities of its platform available to investors too, increasing its attractions to hedge fund managers. No matter how much the major firms disparage Merlin, it is clearly getting something right. Scores are up this year in three out of four questions and two out of three service areas, and from already stellar levels. Merlin doubled its revenues last year, added a Dallas office to its existing presence in New York and San Francisco, and had no problem persuading high-profile private equity house Sequoia Capital to invest $20 million in the firm.		GLOBAL SCORES MINUS OUTLIERS %All Score Minus Outliers Single PB 91.2% 6.51 6.34 Multi-PB 8.8% 5.67 5.67 Total 100% 6.41 6.24   Global Weighted Average   1 Merlin Securities 6.41 2 Jefferies & Company 6.30 3 Fidelity Prime 6.02 4 Deutsche Bank 5.95 5 Bank of America 5.95 6 Merrill Lynch 5.90 7 Morgan Stanley 5.88 8 Bear Stearns 5.88 9 Lehman Brothers 5.85 10 UBS 5.85 11 Credit Suisse Prime Services 5.83 12 Citi Prime Services 5.82 13 Gar Wood Securities 5.67 14 Goldman Sachs 5.62
Service Area Client Svc Operations Consulting Financing Sec Lending Reporting Cap Intro Technology Value Total Global 6.56 6.59 6.22 6.20 6.30 6.69 5.91 6.75 6.47 6.41 Single Strategy 6.47 Multi-Strategy 6.37 North America 6.39 Single PB 6.51   Single Strategy   1 Merlin Securities 6.47 2 Jefferies & Company 6.43 3 Deutsche Bank 6.17 4 Bear Stearns 6.16 5 Bank of America 6.04 6 UBS 6.03 7 Morgan Stanley 6.00 8 Credit Suisse Prime Services 5.93 9 Merrill Lynch 5.93 10 Lehman Brothers 5.78 11 Citi Prime Services 5.74 12 Goldman Sachs 5.72 13 Newedge Group (UK Branch) 5.46       North America   1 Merlin Securities 6.39 2 Jefferies & Company 6.30 3 Deutsche Bank 6.10 4 Credit Suisse Prime Services 6.09 5 Morgan Stanley 6.00 6 UBS 5.97 7 Bank of America 5.95 8 Lehman Brother 5.92 9 Merrill Lynch 5.89 10 Bear Stearns 5.88 11 Citi Prime Services 5.84 12 Goldman Sachs 5.71 13 Barclays 5.69 14 Newedge Group (UK Branch) 5.32 Multi-Strategy   1 Merlin Securities 6.37 2 Jefferies & Company 6.15 3 Bank of America 5.90 4 Merrill Lynch 5.89 5 Deutsche Bank 5.87 6 Lehman Brothers 5.86 7 Citi Prime Services 5.85 8 Credit Suisse Prime Services 5.81 9 Morgan Stanley 5.79 10 Bear Stearns 5.77 11 UBS 5.74 12 Newedge Group (UK Branch) 5.70 13 Goldman Sachs 5.58       Single Prime Broker   1 Merlin Securities 6.51 2 Jefferies & Company 6.40 3 Bear Stearns 6.37 4 Merrill Lynch 6.34 5 UBS 6.06 6 Deutsche Bank 6.05 7 Morgan Stanley 6.02 8 Citi Prime Services 5.96 9 Bank of America 5.90 10 TD Securities 5.89 11 Credit Suisse Prime Services 5.83 12 Newedge Group (UK Branch) 5.82 13 Lehman Brothers 5.79 14 Goldman Sachs 5.36