AIMA publishes hedge fund industry guide

EUROPE- AIMA, the Alternative Investment Management Association, and European hedge fund industry participants, led by Goldman Sachs, have published a guide advising Europe’s hedge fund managers how to adopt sound business practices and reduce the risks of costly mistakes.

Says Segun Aganga, head of hedge fund consulting at Goldman Sachs Prime Brokerage: “the guide will allow new entrants to benefit from the experience of other well established and successful hedge fund managers and industry participants.” Guide contributors include investment managers, accountants, brokers, lawyers, consultants.

The pamphlet, entitled “Guide to Sound Practices for European Hedge Fund Managers”, deals with issues such as creating and managing a hedge fund business; investment process and portfolio risk management; portfolio administration and operational controls; raising capital and investor relations; and the legal structure of hedge funds.

Hedge funds have recently seen their reputation tarnished following complaints that their short-selling adds to market volatility. They have also come under scrutiny for the lack of regulations that apply to them.

The FSA is currently reviewing its regulatory regime in respect of hedge fund activities in the UK. In reference to the guide, a spokeswoman at the FSA said that “any initiatives that helped to increase industry standards were welcomed.”