WEST PALM BEACH, FL (HEDGECO.NET) – A new report compiled by PricewaterhouseCoopers [PWC] concluded that hedge funds could play a vital role in stabilizing the faltering European pension system byinfluencing European industry regulators. Among its conclusions, the report stated, �In the current bear market, regulators need to be seen to be considering ways in which investors can obtain accessto alternative types of products which may assist, for example, in addressing issues associated with the European pensions �time bomb��.
For some time, European business leaders, politicians, policy makers and pension providers have been discussing ways to avoid a crisis in Europe’s pension system. The problem relates to the tendency for many couples in Europe to have fewer children, compounded by the growing number of older age populations. These factors may put pressure on the European Pension plans in the future, because fewer workers are picking up the burden to support growing number of pensioners.
The PWC report said that hedge fund managers could play an important role in addressing these matters. Hedge fund managers should seek active ways to consult with the European regulators, for beneficial policies and solutions through upcoming regulatory laws, which are inevitable. Many more European investors are getting interested in absolute return strategies of alternative investments, such as hedge funds. The availability of retail hedge funds in Europe is still largely curtailed, although some European member states are passing new laws to make hedge funds more readily available to the investors.
Some European pension schemes have begun to adopt hedge fund strategies as part of their investment philosophy, but their number is still small. No one knows for certain if hedge fund investments alone could solve the potential pension plan problems looming in the European horizon. However, the PWC report also noted that there are increasing demands from European institutional investors, such as pension plans for hedge fund products, which have slowly been made available to a small segment of the retail markets.
Paul Oranika
Editor-in-Chief
HedgeCo.Net
Email: [email protected]
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