Tue, Sep 2, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Preqin survey: only 22% of hedge fund managers are compliant with forthcoming AIFMD regulations

Thursday, July 18, 2013
Opalesque Industry Update - Preqin’s recent survey of 220 hedge fund managers around the world reveals that there is still uncertainty surrounding the Alternative Investment Fund Managers Directive (AIFMD) among many managers, with 40% of managers that will be impacted by the AIFMD waiting for finalizations of regulations and further advice from their local regulators before taking action.

The AIFMD will be implemented into national law by EU member states on 22 July 2013. New Alternative Investment Fund Managers (AIFMs) will be required to comply with the directive going forwards, although existing AIFMs will have until 22 July 2014 to apply for authorization to their regulator.

These interviews also revealed that North American hedge fund managers that will be affected by the AIFMD are less prepared than their European counterparts, with 51% of North America-based respondents looking to market their funds to European investors already compliant or will be compliant by July 2014 compared to 64% of respondents based in Europe that will be impacted by the regulation.

Other Key Facts:

• 22% of hedge fund managers interviewed by Preqin that will be impacted by AIFMD are already compliant, and 3% of those affected feel they will not be compliant by the July 2014 deadline.
• 72% of hedge fund managers interviewed will be impacted by the AIFMD; 28% will not be affected, either
because they do not market within the EU or they have no active funds.
• 65% of all North America-based hedge fund managers interviewed stated that they will be affected by AIFMD.
• 44% of North America-based managers affected by the AIFMD are waiting on further advice from legislators in their jurisdiction.
• Larger hedge fund managers that will be impacted by the AIFMD are the most prepared – 65% of those fund managers interviewed with assets under management over $1bn are either already compliant or will be by July 2014, compared to just 31% and 54% of those in the $500-999mn and the $100-$499mn brackets respectively.
• There is mixed sentiment from investors over the impact of regulation launched in the industry, with 35% feeling regulations will be positive and 22% thinking the opposite. Many investors are unsure of the impact regulations will have.


Amy Bensted, Head of Hedge Fund Products, commented: “With the imminent launch of the AIFMD, the majority of hedge fund managers still have work to do in ensuring their funds are fully compliant with the regulations. Based on Preqin’s survey ofhedge fund managers based around the world, Europe-based managers seem better prepared than their North American counterparts at this stage. The phased compliance period for non-EU managers means that a number of North American funds are choosing to wait and see the initial impact of the regulations in Europe before altering their processes.

Many institutional investors have yet to be convinced about the benefits of regulation in the hedge fund industry and they will be watching closely to see the effect that the AIFMD has on the fund management industry. However, with over a third of investors believing that regulation is positive for the industry, the potential is the AIFMD “brand” could lead to greater inflows into hedge funds as investors seek out the regulator’s seal of approval. With uncertainty still surrounding the impact of the directive, it may not be possible to assess the full impact of the AIFMD on the hedge fund universe before 2014.”

Press release

Preqin: www.preqin.com

Bg

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
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. Study shows what resonates with investors: 'Unwavering', 'passionate' beats 'committed', 'dedicated' and more surprises[more]

    Komfie Manalo, Opalesque Asia: A new study by Pershing, a unit of BNY Mellon company, showed that an effective value proposition strengthens audience connections and fosters growth, yet many advisors have had little objective guidance in formulating such statements until now. In the study

  2. Legal – GE Capital and Petters-related hedge fund in legal battle, SEC sanctions Donald Brownstein's hedge fund over conflicts of interest[more]

    GE Capital and Petters-related hedge fund in legal battle From Startribune.com: A billion-dollar legal battle is brewing in Florida over who knew what and when about the decade-long Ponzi scheme operated by former Wayzata businessman Tom Petters. The bankruptcy trustee for two failed Flo

  3. Managed futures' global diversification is important in next phase of economic recovery[more]

    Komfie Manalo, Opalesque Asia: The global diversification provided by managed futures may prove to be extremely valuable as the markets enter the next phase of the economic recovery, said Campbell & Company, a pioneer in absolute return invest

  4. Comment – Why you should avoid the hottest hedge fund hands, Swedroe attacks Hussman over risk management, relative value strategy[more]

    Why you should avoid the hottest hedge fund hands FromCNBC/Yahoo.com: Investors who don't have money with Pershing Square Capital Management are likely salivating at the hedge fund's industry-leading 26 percent return from January through July. But investing with Bill Ackman and other to

  5. Ex-UBS prop trader's hedge fund Manikay Partners eyes UK launch[more]

    From eFinancialnews.com: Manikay Partners, a $1.7 billion US multi-strategy hedge fund set up in 2008 by a proprietary trader from UBS with backing from Goldman Sachs, is planning to open in the UK. New York-based Manikay's move into Europe comes after Financial News revealed on Monday that Aurelius