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From Benedicte Gravrand, Geneva:
Hedge fund self-regulation is the current trend to watch for, both in the U.K. and the U.S., and soon elsewhere. Mr. Mark Palmer, financial attorney at the international law firm Bracewell & Giuliani LLP (website) supports this trend and gave his reasons for doing so to Opalesque.
A logical step
As hedge funds are becoming important players in the world’s financial markets, so is their impact on the markets’ stability: crisis such as LTCM or Amaranth can ruffle the financial systems seriously. Their edge with other financial products lies in their lack of regulations and their freedom to keep their investment strategies private, which entails lack of transparency. Regulators and investors have been requiring more of that for quite a while and this year, the SEC, as well as the German finance ministry, have attempted to stamp down but failed for practical reasons. Self-regulatory groups were then set up, this summer in the U.K., and more recently in the U.S. Following suit, the G7 industrial states expect the hedge funds industry to implement its own code of conduct from next year, Financial Times Deutschland said last week.
For and against
Do hedge funds need regulations? If not, do they need self-regulations to improve disclosure and investor confidence? Some have argued that hedge funds...................... To view our full article Click here
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