State Level Hedge Fund Investment Advisor Exemptions – Connecticut Exemption
Hedge fund managers which are not required to register as investment advisors with the SEC because of the exemption in Section 203(b)(3) of the Investment Advisers Act may still need to register as investment advisors with the state securities commission of the state where they have their place of business. Continue reading
he following is a summary of the major laws which affect the hedge fund industry. If you have any questions on how these laws impact hedge funds in general or your specific situation, please contact us.
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Securities Act of 1933 – the 1933 Act was enacted on May 27, 1933 as a reaction to the market crash of 1929. The overarching purpose of the act was to require that all “securities” be registered with the government (at the time the FTC). The Act provides some exemptions from this general requirement; for hedge fund managers, the most important exemption from registration is found in Section 4(2) which provides that securities will not need to be registered is they are sold in a transaction which does not involving any public offering. Continue reading
I just came across this speech by a former Acting Chairman of the CFTC. The speech discusses Commodity Pool Operators in the context of hedge funds. The original speech can be found here. Continue reading
At a recent speech at the 2008 CCOutreach National Seminar, a seminar for the Chief Compliance Officers of registered investment advisors, SEC Chairman Christopher Cox noted the importance of compliance offices during these volatile times. Cox noted that CCOs are partners with the SEC to ensure that investment advisory firms remain compliant and follow all investment advisory rules and regulations. The speech is reprinted below. Continue reading
The Hedge Fund Law Blog has been running for almost four months now (although we’ve posted articles previously written) and we appreciate all of the comments and insights from hedge fund managers and hedge fund service providers. Our goal is to provide the most relevant legal information to hedge fund managers as possible, so please let us know if you have any questions we can answer. Our other goal is to help managers establish their hedge funds so please contact us if you are thinking of starting a fund.
The following are the most popular articles on the hedge fund law blog as today:
Please contact us if you want to see articles on other topics or if you would like to start a hedge fund.
Can a manager lauch a successful hedge fund with less than $1 million in assets? Yes.
While having a large amount of AUM when starting out can be helpful, start up hedge fund managers do not necessarily need to start with a large asset base to have a large, successful hedge fund. Case in point – David Einhorn. David Einhorn started his hedge fund in 1996 with $900,000. His Greenlight Capital fund now has AUM of around $5 billion. Continue reading
In working toward greater oversight and regulation of the capital markets (which, in this case, many people in the hedge fund industry agree with), the SEC and CFTC signed a memorandum of understanding with the Federal Reserve Board on the CDS markets. Below is a release from the SEC and from the Treasury. Continue reading
Hedge Fund Investment Strategies
Long-short equity is a popular hedge fund strategy where in which the manager initiates both long and short positions in the portfolio. The exact strategy or substratgey the manager uses will be proprietary and the percentage of longs and shorts will differ with each manager. Continue reading
The SEC recently brought an action against the principal of a broker dealer for not being registered as a principal. There are many instances where members of the investment management are operating without having the proper registrations or licenses and many times these people think that they can remain under the radar as long as they aren’t acting fraudulently. In this instance the principal was not able to remain under the radar. Continue reading
The race has begun. Members of the Congress and the Senate will be jockeying for position in the new race toward hedge fund regulation. Senator Grassley announced today that he will be reintroducing a bill to require hedge fund managers to register as investment advisors with the SEC. The text of the full release can be found below. Continue reading