This question came to us yesterday: Question: What happens if a hedge fund doesn’t do proper diligence to ascertain that a client meets the qualified purchaser standards? Does the hedge fund have to register or notify the SEC? Answer: In practice I don’t know how this would happen unless someone [...]

There are many news stories out covering what may be a worst case scenario for many hedge funds – the distinct possibility of no performance fees this year.  This seems to be a major topic of conversation for many people within the industry and just yesterday I received the following [...]

There has been so much news and volitility over the past couple of weeks that it is hard to get a feeling of where things are headed.  It seems pretty clear, however, that this in this brave new world of government sponsored capitalism there is likely to be more hedge [...]

As I’ve noted in many of my posts, I will try my best to answer your questions or point you to a post within the site which discusses the subject. Below is a common question for licensed brokers who are getting into the hedge fund industry. Question: I currently hold [...]

One of the major questions right now from both hedge fund investors and hedge fund managers is how safe are their assets.  I will be writing an article detailing the answer to this question over the next couple of days. In the interim, the SEC has released a statement and [...]

Real estate hedge funds have always been popular and considering the current stock market turmoil and volatility many real estate hedge fund sponsors believe that the time is ripe to offer a real estate product to market weary investors. Potential Investments Real estate hedge funds are not limited in their [...]

One hedge fund strategy is a hedge fund of funds or fund of funds for short. Fund of funds managers invest in other hedge funds rather than trade directly in the financial markets, and thus offer investors broader exposure to different hedge fund managers and strategies. Like hedge funds, funds [...]

Hedge fund managers have to be especially aware of the ERISA rules with regard to their hedge fund and the investors in the fund. ERISA stands for the Employee Retirement Income Security Act of 1974 and it governs, among other things, pension investments into hedge funds.  The Department of Labor [...]

Question: What is a private equity fund?  What is the difference between a private equity fund and a hedge fund? Answer: For many people who are not familiar with the alternative investment industry, hedge funds and private equity funds look like the same thing.  The distinction is not necessarily in [...]

In a time of unprecedented moves by the federal government, the SEC is halting short sales in certain financial stocks.  The SEC is also requiring large institutional investors, such as hedge funds, to show the world their short positions.  The press release can be found here.  The list of financial [...]