Each business day HedgeCo.Net keeps you informed with the top hedge fund industry news, opinion and insight from around the globe. From the latest hedge fund launches, to the impact of regulation, competition, and investor activism - we track the topics and people that make a difference to you.
The Guardian – The BIS said the retreat from riskier investments such as stocks in favour of safer bonds could pressure stock markets, delaying their recovery. "Similarly, the decline in the pension wealth of households participating in defined contribution plans and of employers sponsoring defined benefit plans has implications for aggregate spending," the BIS said.
Hedge funds did not play a central role in shaping the crisis but they will feel its impact, the BIS said.
After many wealthy individual investors withdrew, the funds are targeting institutions.
"Such a shift engenders demands for greater transparency about the investment strategy and greater scrutiny of risk management processes," the BIS said.
On Wall Street – A Connecticut bill that would have imposed transparency and licensing requirements on hedge funds failed to be signed into law Wednesday when the state house of representatives ran out of time to vote on the measure.
The legislature’s special sessions will now focus on the state budget and, therefore, will not be able to address the proposed legislation.
“We’ll have to bring it up again next year,” Ryan Barry, co-chairman of the state house’s joint banks committee and the main supporter of the bill, told Dow Jones.
Bloomberg – Hedge funds and other investors who short-sell shares in Britain’s financial companies must continue to disclose their trades, the U.K.’s financial regulator said.
A reporting requirement put in place by the Financial Services Authority in January will continue until new short- selling rules come into place, the agency said in a statement today. The requirement had been due to lapse on June 30. The new set of rules is expected to come into force in 2010.
“Keeping the disclosure requirements will continue to enhance transparency and limit the potential for market abuse, while details of a long-term regime for short-selling are being drawn up,” said Sally Dewar, the FSA’s managing director of wholesale and markets.
Reuters UK – Pension fund manager Hermes has called for a shake-up of the hedge fund industry, demanding greater transparency and fee structures closer aligned to performance.
The asset manager, which runs BT’s giant pension fund, said it wanted to set up an action committee to help drive through reforms on disclosure.
"I believe that hedge funds want to do the right thing," Matteo Dante Perruccio, head of Hermes’ hedge fund arm, told The Sunday Times.
West Palm Beach (HedgeCo.net) – U.S. hedge fund manager MTM Global Financial Services is looking for an offshore hedge fund partner. In order to raise approximately $50 million in capital for a REIT fund focused on newer US residential real estate in state income tax free Florida, Texas, Nevada and Washington.
The fund manager says, "By creating a joint venture with an offshore mutual fund, hedge fund, or high net worth individual, MTM Global Financial Services will provide the acquisition services, along with the day to day operation of the real estate rental portfolios."
"This is a straight up deal, with huge upside, that will offer transparency and integrity for the investors." the President of MTM Global Financial Services said, "we seek a joint venture partner, that is results driven, that values their reputation, and knows a good thing when they see one. We think this could become a lucrative long term enterprise for all involved."
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West Palm Beach (HedgeCo.net) – Vienna based hedge fund manager Salus Alpha Group Services GmbH has been awarded the alternative investments award of geld-magazins for extraordinary good performance for their Salus Alpha Directional Markets UCITS III Funds.
The Swedish state pension platform, Premium Pension Authority, recently included Salus Alpha funds in its portfolio. Included on the platform are Salus Alpha Real Estate, multi manager funds Salus Alpha Event Driven, Salus Alpha Managed Futures and Salus Alpha Equity Hedged.
The Salus Alpha funds that were chosen are UCITS III compliant, and meet the strict requirements regarding transparency, daily liquidity and adequate administration procedures set up for hedge funds by the Swedish pension authority.
HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds!
AllAfrica.com – The Financial Services Board (FSB) has begun work on legislation to control hedge funds, which played a critical role in the global economic meltdown.
FSB CEO Dube Tshidi said yesterday the aim with the legislation, a first for SA, was to limit risk and achieve greater transparency. A dedicated team was working quite fast on the project which could be finished next year.
Hedge fund managers are required only to be registered and meet certain conditions such as to be fit and proper persons, but Tshidi said it was necessary to regulate the funds themselves.
Hedge Week.com – For most of the past decade, the Cayman Islands have been the world’s dominant offshore alternative fund domicile. At the last count, the jurisdiction had around 10,000 funds, the vast majority of which are hedge funds of one stripe or another.
But with offshore financial services under hostile scrutiny as never before, Cayman finds itself on a ‘grey list’ of jurisdictions assessed by the Organisation for Economic Co-operation and Development as having signed up to the principles of tax transparency and exchange of information but failed, so far at least, to have adequately implemented them by signing tax information exchange agreements with OECD members.
Business24-7 – Stability, and not necessarily an upward move by economies, would be enough to attract investors back to alternative investments such as hedge funds, says Dr Frank Gerhard of Barclays Capital.
The crisis has made investors focus more on due diligence and, at the same time, turned attention back to fundamentals and to issues such as the integrity of managers. "Those managers are going to benefit going forward if they address structural issues of leverage, transparency and uncertainty around liquidity," said Gerhard, the company’s Director and Head of Product Strategy for Fund-Linked Derivatives.
AFP – The United States and Switzerland will begin negotiations to amend their bilateral income tax treaty to provide for improved transparency, the US Treasury Department said Monday.
The announcement came following Group of 20 pledges last week to clean up tax havens and fight tax fraud and as bilateral relations have been strained by a massive tax fraud case involving Swiss banking giant UBS.
The negotiations to amend the 1996 treaty are expected to begin April 28 in Berne, Switzerland, the Treasury Department said in a statement.
HedgeCo.Net – The "post-Madoff era" and the litigious society in which firms operate today have presented many operational risks that are beyond control. Managers are not getting paid to take those risks and the consequences can be devastating.
Regulatory investigations and private litigations are on the rise and may result in expensive legal defense and the allocation of resources away from your business.
The new administration supports increased transparency and the regulation of hedge funds. In addition, there is an immense amount of international pressure in favor of regulation. This has made it very politically attractive to support the legislation of industry regulation, which may potentially threaten your business.
But there are options.
At CBS Coverage, the Financial Institutions Risk Group is focused solely on protecting your fund, its investors, and yourself.
CBS provides an excellent added value to your hedge fund and can help increase your investor confidence and trust.
Bloomberg – A group of hedge funds offered to increase disclosure to head off demands from politicians on at least two continents for more transparency.
“We know which way the wind is blowing,” said Andrew Baker, chief executive of London-based Alternative Investment Management Association, the industry’s largest lobby group. “We see a lot of this as inevitable and we’d like to put ourselves in a position to say, ‘You don’t have to drag this out of us.’”
European leaders meeting in Berlin on Feb. 22 said they want to subject the $1.4 trillion industry to more regulation because hedge funds “may present a systemic risk” to world economies, according to German Chancellor Angela Merkel.
