Book Review: A Guide to Starting Your Hedge Fund

I have known Erik Serrano Berntsen and John Thompson, who teamed up to form the London-based hedge fund seeding firm Stable Asset Management, probably for a decade, so I was very excited when they sent me a copy of their "Guide to Starting Your Hedge Fund" which recently came out at Wiley.

To be frank with you, I don't always read books that are sent to me, but this one has some unique strength that I am happy to convey. Given the background of the two authors, especially John Thompson's, who also served as Member of the Supervisory Board of the European Energy Exchange, the book has strong focus on energy and commodity funds and markets, but readers active in all hedge funds – and even investors who want to gain a better understanding of the new realities - will find the third and fourth parts of the book of exceptional value.

In those two sections the authors write in great detail about:

• The Business plan (of a hedge fund firm)
• Laws, Contracts and Lawyers
• Service Providers
• Fundraising
• Operations and Infrastructure

In the Appendix, the interested reader finds additional, detailed resources, such as

• A Sample Business Plan Outline
• Outline of a Confidential Explanatory Memorandum (Sample Offshore Feeder)
• Sample Due Diligence Questionnaire Outline

I found those to be very valuable information for which consultants and other service providers will probably charge some hefty fees.

Investing in Energy Commodity Hedge Funds

Whilst oil has long been traded by hedge funds, natural gas, electricity, and the environmental products like emissions allowances and weather derivatives are the new and highly desirable investment strategies. But these high returns come with major risk, and so "A Guide to Starting Your Hedge Fund" gives savvy investors and fund managers the information they need to make smart decisions. Specifically, cha......................

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This article was published in Opalesque's New Managers a top-down monthly analysis, news and research publication on the global emerging manager space.