The evolving role of hedge funds in institutional investor portfolios

Institutional investors face an almost unprecedented set of challenges. The post-crisis period has been one of slow economic growth, low or even negative real interest rates, volatile markets and increasing geo-political pressures.   

 

Know your score and get to the “sweet spot”: The importance of business...

This article discusses the importance of business process automation within an asset management firm at all stages of development and how these organisations can measure their current processes versus investor expectations.

Updates further enhance Cayman’s appeal

The Cayman Islands has for decades been one of the world’s leading banking and financial centers, currently ranking as the fifth largest banking centre worldwide, with over 200 banks, including 40 of the world’s 50 largest banks, and over US$1.5 trillion in assets. 

 

Drawing a line in the sand over the right to information

Concerns in the U.S. and Europe over security leaks and the debate about access to public versus private information runs in some ways parallel to the discussion regarding the information investors prefer and require to make informed decisions about their investments in Cayman Islands funds.

 

The Financial Services Legislative Committee

Over the years, in fact for the whole period leading up to Cayman achieving its position as a leading offshore jurisdiction for institutional clients, one of our strongest selling points was that our private and public sectors worked together to draft bespoke legislation to meet the ever-changing needs of the financial market.

Does location matter?

The world has become global and this not only on business and private sides, but also family offices are seeking increasingly to get the most out of this international playing field at their hand.   

 

Into the spotlight: Independent fund directors

Independent directors and non executive directors have come into the spotlight in recent years following the well reported failings of firms such as Weavering Capital.  In earlier examples, Beacon Hill Asset Management and Bear Stearns High Grade Structured Credit’s offshore fund directors were singled out for criticism for failing in their duties. 

Investing 101 – Setting the parameters

I recently participated in an investment panel as part of the 2011 Cayman Captive Forum. The intent was to give the owners of captive insurance companies an insight into the factors they ought to be considering in establishing and monitoring an investment programme for their company.

Unit trusts: Forget-me-not

Read our article in the Cayman Financial Review Magazine, eversion The structuring of investment funds as unit trusts has been and continues to be the...

Fund governance that runs like a Swiss watch

In the current investment climate, is any institutional investor going to invest in your fund if your service providers deliver an unregulated service?

Cayman funds stand strong in new era of governance

With the global hedge fund industry transitioning into a new era of heightened regulation and stricter fund governance, the Cayman Islands are extremely well placed to respond to the associated challenges.

 

 

Beware of unwanted side effects from side letters

In the current competitive hedge fund marketplace the use of side letters between investors and funds has become commonplace. Side letters are used by funds and fund managers to draw in investors who jockey for the most favourable terms possible.   

 

Private equity investment into Africa: The Cayman and Mauritius route

The invitation in December 2010 by China to South Africa to join the BRIC group of major emerging economies, to create the ‘BRICS’ acronym, has heralded a new dawn, not only for the nation of South Africa, but arguably for the continent of Africa as a whole.

Understanding investor due diligence

The investor due diligence process has evolved with the growth of the hedge fund industry. What was once a short and rather perfunctory process has grown into one which today is highly quantitative and detailed.

 

Where there’s smoke, is there fire? Some red flags in hedge fund fraud

We have identified certain red flags that we have seen in more than one situation and provide some practical guidance that investors may wish to consider to mitigate the risk of being victims of a fraud. 

 

 

Hedge fund due diligence: The last line of defence

Investors expend substantial time and resources on due diligence. However, much of their efforts are front loaded, focused on quantitative measures with a bias towards initial due diligence, ie spotting the “bad apples” before they are included in a portfolio

How to address increased compliance cost for private funds

In the long run, private fund advisers may decide to forego the services of third party service providers and device strategies that allow them to fulfill their reporting obligations under the Dodd-Frank Act more effectively, thus lowering compliance costs further.

 

Regulators to decide over UCITS split

European regulators will decide early this year whether UCITS funds should be reclassified as “complex” and “non-complex” products in order to improve transparency of information about investment strategies.

 

Innovation and change in the director services industry

Legislative changes introduced director registration or licensing requirements and new regulations. In addition, law firms started to spin off their administration divisions and private equity and other buyers entered the market.

 

Fund governance: The trend toward split boards

This industry trend is being driven by investors who consider that the challenges of such a model are far outweighed by the benefits provided to them by a board that will be more effective in all situations.