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Alternative Market Briefing

Hedge fund registration extension not a surprise, less than half of smaller fund managers estimated to be registered

Wednesday, April 13, 2011

From Kirsten Bischoff, Opalesque New York:

The SEC’s indication late last week that it would likely extend the hedge fund and private equity fund registration deadlines was not a complete surprise to many in the industry. Opalesque spoke with Kinetic Partners’ Andrew Shrimpton last week about general trends the global professional services firm which advises many of the worlds hedge funds sees unfolding in the industry. Shrimpton indicated during the call that although nothing had been yet formally stated by the agency, expectations were, the SEC would likely give hedge funds some leeway on registration due largely to the fact that many of the final rules the regulatory agency must issue have yet to be finalized.

While it is estimated that nearly one-third of billion dollar plus hedge funds have yet to register Kinetic Partners has also found that smaller managers (under $400m) have also dragged their feet in registering, with the firm estimating that only 40% of smaller fund managers have been proactive with registration. There have been questions as to whether or not fund managers close to or slightly under $150m (the indicated cutoff for exemption from registration) will register before they are required to, and Shrimpton says that those smaller fund managers he has talked to have indicated that they will register ahead of time, so as not to require close monitoring of their assets.......................

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