Private investors are finally to be allowed access to hedge funds
Tuesday 26 February 2008
Private investors are finally to be allowed access to hedge funds through UK retail products, under changes to the regulatory regime proposed by the Treasury and the Financial Services Authority says Matthew Vincent the FT on February 22.
Advisers now expect retail fund management groups, such as Jupiter, Artemis, and New Star, to launch funds of hedge funds and other alternative investments, from next year.
I have no doubt that investors will buy these investments. Why? As the FT says "Private investors' appetite for hedge funds has grown rapidly in recent years.” The appetite is driven by a perception of profit, otherwise known as greed. Yet hedge funds are very opaque, the charging structure is excessive, and now the FSA want to let retail investors buy into these products.
Without doubt that is great news for the fund management groups. They will use their retail marketing experience to collect funds under management.
Investors’ expectations will be for high profits. Whether these funds will consistently outperform and are worth the fees investors will pay, I very much doubt it. Of course there will be success stories, but knowing which ones to invest in before they hit the big-time may require more than a touch of good fortune.
When I get in the post the direct marketing promoting these new funds, I will diligently file them away in file 13.
Categories: Hedge Funds, Retail Funds
posted by Murray Round Wealth Management @ 09:51,
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Nicholas Round
Nic is the Managing Director of Murray Round Wealth Management Limited, who seeks to ensure the advice provided is truly independent. Based in Shropshire with clients local, national and worldwide, Nic has strived to find the best possible service for his clients needs, by researching and studying the market, trends and philosophies. Nic strongly believes Asset Class Management will bring his clients Financial Freedom, Independence and Happiness.
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Kirsty is our communication guru. Managing information requires considerable due diligence and her passion for organisation gives the clarity we all seek. From Shropshire, with a Psychology Degree and much travelling, she is now back in Shrewsbury...and London often, keeping us all at Murray Round focused.
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