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November 01, 2005
The FSA gives Hedge Funds a wider target audience, but with a hidden catch
The debate on the regulation aspect of the hedge funds industry never seems to cease. Since, the cynicism amongst the supporters of any such regulations on these funds does not seem to be in the near future. The Financial Services Authority (FSA), the UK financial watchdog, has played really very on this sticky wicket. The FSA announced that hedge funds as an investment option will now be open to institutions or rich individuals through their high-street bank and to have hedge fund holdings through their ISAs or Sipps. This would open up the lucrative market to a wider base of potential investors towards the hedge funds industry. However, this would come with a catch; the FSA has created a specialist unit that will monitor the hedge-fund managers trading behavior more closely. This would be quite a surreptitious step for the FSA towards regulation of the hedge funds industry. The Business Online.com Reports:
Currently, hedge funds, which are estimated to manage about $1 trillion (£560bn, E830bn), are regarded as an investment option open to institutions or rich individuals. Such a move could allow individuals to invest in hedge funds through their high-street bank and to have hedge fund holdings through their ISAs or Sipps.
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