The transition of hedge funds from the unregulated to regulated space was an enormous undertaking. Within 18 months, close to 300 individual portfolios have been registered and approved by the Financial Services Board (FSB) writes Johann Barnard.
According to figures from the regulator, the first tranche of funds was approved in November 2015 and the launch was early last year.
Following the initial tranche of approvals, manco and portfolio approvals picked up from April last year through to September, by which time the number of approved funds had grown to around 270 portfolios. Graeme Rate, head of hedge funds at Sanne Group, a global provider of administrative and management company (manco) services to the industry, says it is still early days for mancos, investment managers and administrators in the new, regulated environment. "We’ve seen a relatively muted appetite from investors that haven’t been invested in the hedge fund space prior to regulation," he says. "Investment managers are seeing the move into the regulated space has come with an additional cost component in terms of regulatory compliance. There has also been a lack of clarity around certain issues, such as TER [total expense ratio] and TC [total cost] reporting. "There are a number of issues that still need to be worked through ... but in a fledgling environment these issues take time to ...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.