Fri, Jul 31, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Opalesque UCITS intelligence

Legal Brief - THE COST OF COMPLIANCE published by AIMA with KPMG and MFA.

Tuesday, November 05, 2013

The report is the biggest ever global hedge fund survey, covering 200 managers managing more than $900 bn in Europe, Asia and US.

The report examines the extent to which the industry is investing heavily in the infrastructure of regulatory compliance.

My selected key findings in this report:

  • The hedge fund sector is making great efforts to achieve compliance. It’s part of a broader picture of managers building their infrastructure in order to attract more institutional capital.
  • Operating costs dedicated to regulatory compliance represent an average 7% of operating costs.
  • Few managers pass these costs to investors and therefore regulation impact margins.
  • Barriers to entry for the industry are being raised because the cost of that compliance disproportionately impacts smaller managers.
  • Regulatory constraints have a major impact on business strategy, especially for the big firms.
  • AIFM and SEC registration are perceived as the more costly regimes.

More importantly, according to the survey, two types of attitude will emerge : 48% consider changing their operating model and the other half not. There was no real variation of this split across firm size or regions. Certainly the bigger firms have or will develop their legal and compliance capabilities as the smaller firms are more likely to continue to outsource their operating model.

In term of product development, the reports outlines a general view that « Products are driven by client demand not by regulation ». Nevertheless, client demand is more and more driven by their own regulatory framework.

The report can be downloaded on aima.org - kpmg.com - kpmg.com



 
This article was published in Opalesque UCITS intelligence.
Opalesque UCITS intelligence
Opalesque UCITS intelligence
Opalesque UCITS intelligence
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. Opalesque Exclusive: Despite bumpy June/July, CTAs hold on[more]

    Bailey McCann, Opalesque New York: To say that things have been rocky in managed futures recently is putting it mildly. In June, the industry saw its worst month on a performance basis in the past four years. Then yesterday,

  2. Investing - Hedge funds, seeing opportunity, invest in struggling hotels in Puerto Rico[more]

    From NYTimes.com: Puerto Rico’s tourism industry has fallen victim to the island’s struggling economy, hit by one misfortune after another. In March, the San Juan Beach Hotel filed for bankruptcy. This week, the Condado Plaza Hilton was forced to close its casino. But nearly two thousand miles away,

  3. Investing - Hedge fund billionaires bet on London as revival gathers pace[more]

    From Bloomberg.com: London’s fund industry is bouncing back, and U.S. billionaires Steven A. Cohen and Ken Griffin are grabbing a piece of the action. Griffin’s Citadel and Millennium Management, a hedge fund run by Israel Englander, have bulked up in London, where asset growth is outpacing the U.S.

  4. Bridgewater turns bearish on China[more]

    Komfie Manalo, Opalesque Asia: The world’s biggest hedge fund Bridgewater Associates and one of the most vocal of China’s potential is now turning its back against the world’s second largest economy as it joins a growing list of high-profile investors who are challenging China’s potentials.

  5. Opalesque Roundup: Hedge fund assets rose to 11th consecutive quarterly record level: hedge fund news, week 31[more]

    In the week ending 24 July, 2015, the total global hedge fund industry assets rose to the 11th consecutive quarterly record level in 2Q15 to $2.97tln; Eurekahedge reported that hedge funds raised $93bn in the first six months of 2015; The SS&C GlobeOp Forward Redemption Indicator for July 201

 

banner