Sun, Sep 25, 2016
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. North America - Acela fight splits hedge fund Connecticut and old money enclaves[more]

    From Bloomberg.com: Connecticut’s residential coastline is two worlds, the one of newcomer millionaires and one whose wealth and New England roots span generations. Now, their differences over a rail route threaten to gum up plans for the U.S. Northeast’s fastest-ever trains. About 30 miles from Man

  2. Activist News - Caesars offers creditors another $1.6bn, would spell end of hedge fund ownership, Activist investors double chance of CEO exits[more]

    Caesars offers creditors another $1.6bn, would spell end of hedge fund ownership From Calvinayre.com: Casino operator Caesars Entertainment has improved its offer to junior creditors to over $5b, but the offer is only good until Friday. On Wednesday, Caesars added an extra $1.6b to the $

  3. Opalesque Exclusive: Modern investor tools (2): A platform that does the job for you[more]

    Benedicte Gravrand, Opalesque Geneva: A new series on technology providers that assist asset allocators. There is disruption in the investor part of the world of hedge funds, coming from platforms that can replace traditionally-run search and analysis. Here is one of them. L

  4. Hedge funds saw four consecutive months of outflows in August, but assets still up by $17.6bn YTD[more]

    Komfie Manalo, Opalesque Asia: Hedge funds witnessed four consecutive months of outflows with investor redemptions totaling $23.8bn as of end of August, data provider Eurekahedge said in its monthly report. But total hedge fund assets grew by

  5. Trend reversals lead to losses as managed futures drops 1.52% in August[more]

    Komfie Manalo, Opalesque Asia: Trend reversals in August have led managed futures traders to lose 1.52% last month according to the Barclay CTA Index compiled by BarclayHedge. The Index is up 0.62% year to dat