Wed, Jan 18, 2017
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Cayman folks see increasing use of Limited Partnership structures for master funds

Thursday, March 13, 2014

amb
Darren Stainrod
Benedicte Gravrand, Opalesque Geneva:

A hedge fund industry development that was noted during the recent Opalesque Cayman Roundtable is the increasing use of Limited Partnership structures for master funds, whether via Delaware or Cayman. According to Darren Stainrod, Principal at HighWater Limited, a provider of professional directors and related services to the alternative investment industry, the use of the structure increased from 5% to 10% of launches to 30% to 40% of recent launches, as it is more suitable for U.S. investors for tax reasons.

"This creates an interesting situation from a corporate governance standpoint as traditionally we would sit on the boards of the Cayman feeder and the Cayman master," he explains. "Once that becomes a Delaware master or a Cayman LP master, then we typically have no responsibility, especially for U.S. managers who usually are the General Partner to the LP master."

He goes on to say that this creates a situation where directors are sitting on a feeder board without any insight or control over what takes place at the master level. To address this issue, he encourages managers to form an advisory committee; such a committee has powers with respect to the master fund, such as liquidity, suspensions, etc. although this area is evolving.

An advisory committee does not have the full fiduciary responsibility that a board of directors does, he adds, &quo......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Southpoint Capital gains 3.8% in Q3, bringing year-to-date returns to 5.2%[more]

    From Valuewalk.com: Southpoint Capital Advisors, the $3 billion New York hedge fund founded by former employees of David Einhorn’s Greenlight Capital, added 3.8% net during the third quarter of 2016, bringing year-to-date returns to 5.2% and cumulative returns since inception (July 2004) of 237.4% a

  2. The Big Picture: The case for emerging market debt in 2017[more]

    Benedicte Gravrand, Opalesque Geneva: Emerging market (EM) assets outperformed in 2016 mainly because of stronger fundamentals and an improving international environment, with GDP picking up speed, leading to positive earnings revisions for the first time in five years,

  3. Short Selling - Long-short hedge funds are ditching the shorts to focus on longs[more]

    From Bloomberg.com: What happens when you take the "short" out of a long-short trading strategy? Some hedge funds are about to find out. Equity long-short fund managers, the biggest category in hedge funds, hold the fewest bearish stock bets on record, data compiled by Credit Suisse Group AG s

  4. SWFs - China sovereign wealth fund CIC plans more U.S. investments[more]

    From Reuters.com: China Investment Corporation (CIC), the country's sovereign wealth fund, is looking to raise alternative investments in the United States due to low returns in public markets, its chairman said on Monday. CIC will boost its investments in private equity and hedge funds as wel

  5. Some hedge funds strong start in 2017 nice contrast to 2016[more]

    With the 2016 HSBC Hedge Weekly performance rankings in the books - a year in which the same leader-board entries pretty much dominated unchallenged throughout the year - comes a new leader board that is a hard-scrabble mix of hedge fund styles and categories. What is clear after but a few short wee