Thu, Sep 3, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Opalesque UCITS intelligence

Assets raising in Europe: Perspectives from a distributor: Gregg Taylor & Anne Simond

Friday, May 16, 2014

The Swiss market for alternative investment funds is highly diverse, some brief comments on appetite in 2014. The demand from pension funds continues to be fragmented, several took a first move back into hedge funds following 2008 by investing solely into macro/managed futures strategies in 2009 and 2010, the negative experience since has dampened enthusiasm for alternatives in general. In addition there are moves to discuss limiting total fees paid across the fund reducing appetite further.

Global corporations whose pension schemes are managed in Switzerland struggle with the challenge of how to convert their defined benefit approach to defined contribution which generally requires access to regulated retail offerings only.

The major private banks who have traditionally had comprehensive alternative offering have seen an increase in demand for single managers as portfolio managers look to reduce fixed income and credit in client portfolios. However certain fund of funds that have met return expectations are seeing some demand. Private banks and wealth managers in general do prefer more liquid and regulated offerings as this increases their target client market.

Family offices continue to be highly diverse in their approach but it should be noted that demand for smaller emerging managers is very limited. In general the new rules governing offering of alternative nonregulated are regarded as pragmatic and far easier for promoters to comply with than the hurdles faced though the implementation of AIFM in Europe.

In order to assist alternative managers wishing to continue to promote their funds, ARM Capital (Swiss) SA are working with Anne Simond to launch ARM Swiss Representatives SA with a focus on offering Swiss representation and distribution services.

REGULATORY KEY POINTS FOR DISTRIBUTING FUNDS IN SWITERLAND

What are the changes that a foreign asset management company should be aware of when distributing or planning to distributing a foreign CIS in Switzerland? As per the circular, the concept of a public offering was replaced by the introduction of the concept of distribution, which is defined as "any offer or advertisement for CIS which is not exclusively addressed to regulated financial intermediaries". According to the Circular, distribution now therefore includes marketing to both qualified and/or nonqualified investors.

While authorization is needed for distribution to nonqualified investors (as it was before), distribution to qualified investors does not require a FINMA authorization. However, it is important to note that the definition of qualified investors has also been replaced by a new definition.

When distributing a foreign fund in Switzerland or planning to distribute a foreign fund in Switzerland, it is now extremely important to ascertain that the target investors meet the qualified investor criteria. As an example non regulated independent asset managers and family offices shall not be considered as qualified investors per se.

One should note also that as per the circular the use of websites is strictly regulated. The main goal is to avoid distribution to non-qualified investors.

Is there specific requirements for distribution to Qualified investors?

Additional change is also the requirement, as of 1 March 2015, to appoint a Swiss legal representative and a paying agent regardless of the type of investors to which the CIS is marketed. This is a new requirement as in the past only CISs registered for public offerings were required to appoint a Swiss representative and a paying agent.



 
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. Cliff Asness attracts $360 million as liquid alternative funds hold up[more]

    From Bloomberg.com: As U.S. stocks suffered their worst month in more than three years in August, Clifford Asness’s managed futures fund was able to profit. Investors are taking notice. The $9.12 billion AQR Managed Futures Strategy Fund pulled in an estimated $360 million in net subscriptions last

  2. Performance - Einhorn and Loeb's hedge funds both decline 5% in August, Some target-date funds miss in the market turmoil[more]

    Einhorn and Loeb's hedge funds both decline 5% in August From Reuters.com: Hedge fund billionaires David Einhorn and Daniel Loeb saw their main funds lose roughly 5 percent in August during a dramatic market sell off, two people familiar with their returns said on Monday. Einhorn's

  3. Opalesque Exclusive: When the SEC calls, fund managers need to get out of their own way[more]

    Bailey McCann, Opalesque New York: New pressure is hitting alternative investment funds from all angles. So far this month both hedge fund and private equity players have seen enforcement actions, and subsequent fines over fees, disclosures, and misleading statements. Citi one of the biggest

  4. Fortress hedge fund manager David Dredge says markets trouble on the way[more]

    From AFR.com: David Dredge of global hedge fund Fortress has built a career studying, predicting and protecting against the world's major financial crises. The recent convulsions in global sharemarkets are "just the beginning" of a painful adjustment as money drains from the emerging market economie

  5. North America - Puerto Rico agency plans talks with hedge fund creditors[more]

    From WSJ.com: Puerto Rico’s Government Development Bank is planning to begin confidential debt-restructuring talks with hedge funds that own its bonds as early as next week, said a person familiar with the matter. The parties are set to discuss a plan under which the investors would lend additional

 

banner