DAVOS, Switzerland (Reuters) – A voluntary code of conduct by the hedge fund industry would be an important first step towards better oversight of this fast-growing segment of the financial markets, European Central Bank Governing Council member Axel Weber told Reuters.

Germany has placed greater transparency of hedge funds, a powerful force in financial markets with $1.7 trillion (870 billion pounds) of assets, high on the agenda for its presidency of the Group of Eight (G8) leading industrial nations this year.

Financial regulators are concerned that the risky trading strategies of these pools of money, originally catering for the ultra-rich but which have grown rapidly over the past five years, could threaten the stability of the financial system.

This worry has displaced concerns about energy costs, the U.S. dollar or cheap cash as the major threat to the world economy here at the World Economic Forum.

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Reuters UK – A voluntary code of conduct by the hedge fund industry would be an important first step towards better oversight of this fast-growing segment of the financial markets, European CentralBank Governing Council member Axel Weber told Reuters.

Germany has placed greater transparency of hedge funds, a powerful force in financial markets with $1.7 trillion (870 billion pounds) of assets, high on the agenda for its presidency of the Group of Eight (G8) leading industrial nations this year.

Financial regulators are concerned that the risky trading strategies of these pools of money, originally catering for the ultra-rich but which have grown rapidly over the past five years, could threaten the stability of the financial system.

This worry has displaced concerns about energy costs, the U.S. dollar or cheap cash as the major threat to the world economy here at the World Economic Forum.

But there is little agreement on how to get hedge funds to disclose more information about their private investment holdings.

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