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12 May 2009

Hedge Fund managers In Bermuda To Register By June 30th

Two new legislations were introduced in Bermuda January 1, requiring regulated financial institutions to comply with various obligations under the recently updated legislative framework, according to Cayman Islands law firm Conyers Dill & Pearman.

The firm said that the updated legislation defines 'Financial Institutions' as persons who, among other things, carry on the business of a 'fund administrator', or are 'operators' of investment funds.

The BMA expects Financial Institutions, under its supervision, to address their management of the relevant risks in a thoughtful and considered way, and to establish and maintain systems and procedures which are appropriate and proportionate to the risks identified.

Investment fund operators and fund administrators are required to appoint a Money Laundering Reporting Officer (“Reporting Officer”) to whom reports should be made and who shall have responsibility to make reports when suspicious circumstances require.

It is a requirement for “non-licensed persons” to register with the BMA by 30 June 2009 using the BMA’s prescribed form and paying the relevant fee. Failure to comply will result in their inability to carry on business activities, the firm said.

Hennessee: April Challenging but Hedge Funds Advance

Hedge fund adviser, Hennessee Group LLC, announced that the Hennessee Hedge Fund Index advanced +3.84% in April (+5.02% YTD).

“April continued to be a challenging environment for hedge funds, as the market rally was driven by short covering and momentum, rather than changes in fundamentals,” commented Charles Gradante, Co-Founder of Hennessee Group. “While we have seen some improvement in data (most typically that the rate of deterioration is slowing), most funds remain conservatively positioned. Funds are cautious and will wait for fundamentals to improve before significantly expanding their net exposures.”

“Hedge funds underperformed again in April, but have still outperformed year to date. Volatility remains elevated with the S&P 500 experiencing a gain or loss greater than 8% each month this year,” said Lee Hennessee , Managing Principal of Hennessee Group . “Last year hedge funds did a good job of protecting capital, so they don’t need a huge rally to reach a new high water mark. Equity markets would need to double from current levels to reach their previous high.”