Sun, Apr 5, 2020
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Hedge fund and private equity investors to focus 2020 due diligence efforts on alternative data compliance

Thursday, January 16, 2020
Opalesque Industry Update - Corgentum Consulting, a provider of operational due diligence reviews and background investigations, announced the results of a new investor and operational due diligence (ODD) analyst survey.

83% of those surveyed indicated that they anticipated continuing to increase the resources allocated to analyzing compliance procedures surrounding alternative investment managers use of third-party research including expert networks. In particular, investors indicated that a key focus in 2020 will be on the security and privacy considerations surrounding hedge funds and private equity managers use of alternative data.

78% of participants indicated that they will for the first time begin incorporating a review of fund manager uses of alternative data. Furthermore, an 96% of those that already review alternative data anticipated expanding their due diligence efforts in this area. Key motivations for this focus cited by investors include

- Increased fund manager use of alternative data in alpha generation

- Strong regulatory push on data security and integrity such as Europe's General Data Protection Regulation (GDPR)

- Increased availability and complexity of big data sets related to financial transactions, sensors, mobile devices, satellites, social media, biometric, geo-location and exhaust data

These findings are also in-line with the recently released 2020 Examination Priorities of the US Securities and Exchange Commissions Office of Compliance Inspections and Examinations.

"Investors want fund managers to utilize alternative data to enhance their investment research process. Corgentum's survey results show that investors also increasingly recognize that with the use of these new data sets comes accompanying operational, compliance and regulatory risks. Allocators are now beginning to tailor their due diligence processes and resources towards analyzing this growing research avenue," said Jason Scharfman, Managing Partner of Corgentum Consulting.

The survey was conducted as part of the Corgentum webinar series hosted by Jason Scharfman, a leading expert in operational due diligence and compliance for hedge funds and private equity. He is also the author of the newly released Private Equity Compliance: Analyzing Conflicts, Fees, and Risks (Wiley Finance) available on Amazon. The book serves as a compliment to the author's previous book Hedge Fund Compliance: Risks, Regulation, and Management.

Article source - Opalesque is not responsible for the content of external internet sites

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. Investing: Ray Dalio's Bridgewater scales down European short bets after $3.2bn windfall, Here's what top hedge funds are buying in the coronavirus stock market crash[more]

    Ray Dalio's Bridgewater scales down European short bets after $3.2bn windfall From Financial News: Bridgewater Associates, the world's biggest hedge fund, has retreated from shorting European stocks after making an estimated €2.9bn ($3.2bn), as its founder and co-chairman Ray Dalio c

  2. Bill Ackman writes letter to shareholders on coronavirus[more]

    Pershing Square Holdings (PSH)'s Bill Ackman wrote a letter to investors outlining his insight on the coronavirus pandemic in the United States. He revealed that PSH completed the process of exiting the hedges on 23 March, netting a gross $2.1bn for PSH, after turning 'increasingly positive on equit

  3. New Launches: LGPS Central sets up investment grade bond fund, Leeds Equity Advisors aims to raise $1bn for PE fund, RLI Investors to launch European last-mile logistics fund, DBL Partners IV targets $450m[more]

    LGPS Central sets up investment grade bond fund From IPE: LGPS Central, the asset pooling vehicle for eight local government pension schemes (LGPS) based in England's Midlands, has launched a global investment grade corporate bond fund in order to meet its partner funds' needs. The po

  4. Investing: Marathon sees cheap assets amid dislocation in credit, Deerfield's health care buying spree, It's time to buy shares again, says BlackRock, Credit Suisse, Fed is buying credit ETFs but one hedge fund is shorting them[more]

    Marathon sees cheap assets amid dislocation in credit From Bloomberg: Distressed-investment specialist Marathon Asset Management is buying beaten-up debt amid the greatest dislocation in credit markets since 2008, according to Bruce Richards, co-founder and chief investment officer of the

  5. People: Carlyle picks 2 deputy heads for Japan buyout advisory team, Ex-Kleinwort Hambros adviser takes senior role at multi-family office boutique[more]

    Carlyle picks 2 deputy heads for Japan buyout advisory team From PIonline.com: Takaomi Tomioka and Hiroyuki Otsuka were named deputy heads of the Japan buyout advisory team at Carlyle Group. The positions are new, confirmed a spokeswoman for the New York-based private markets investment g