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11 Jan 2010

Future Crisis Worries - Hedge Fund Compliance Survey News - Three quarters of the world’s senior banking and compliance officers polled as part of a wide-ranging survey by Complinet, a hedge fund compliance company, said they are expecting the next financial crisis will strike within the first half of this decade, the company said.

The survey found that the majority of regulatory experts questioned predicted the next significant economic downturn before 2015. 77% said recent reforms were insufficient to avoid another crash similar to the 2008 collapse.

The survey of 232 global compliance officers was made up of 34% from the banking sector, 9% insurance, 32% securities, 7% legal, 18% others.

“The continuing lack of company transparency and accountability to the markets and the public makes the possibility of another crisis almost assured,” said one of the businesses questioned.

The Complinet survey also showed that only 40% thought their firm had changed its approach to compensating employees based on a better understanding of risks associated with the business.

And 91% recognised that the current bonus culture is resented by those outside the financial services industry.

But the survey also showed that 62% of senior management believe they’re putting the right controls in place.

“Regulatory reform and implementation of effective compliance solutions are clearly vital to avoid another crash,” says Paul Johns, Vice President of Global Markets at Complinet.

“The key message from this survey is financial institutions must ensure they have enough compliance resource to navigate through the regulatory maze and reduce the risk of falling foul of the rules.”

Bluenose To Launch Onshore Hedge Fund

HedgeCo News - BVI-based investment manager Bluenose Capital Management is planning to launch The Bluenose North American Market Neutral fund, an onshore version of its flagship offshore hedge fund on March 1st, 2010.

The Delaware-domiciled fund has a 1 year lock-up period, with a minimum investment of $250,000, with a 1% management fee and 20% incentive.
Bluenose's JS Pelletier and Dario Borelli will be managing the fund.

Aimed at U.S. accredited and qualified investors, the US & Canada equity market neutral fund has 4 underlying strategies employed according to prevailing market conditions, including systematic, quantitative & automated investment process. With rigorous risk management practices ensuring low downside volatility the new fund trades only highly liquid exchange-listed securities.

The objective is to generate an annualized compound rate of return of 15% with lower downside volatility vs. the S&P500 and TSX benchmarks. Using proprietary multi-factor models, the fund will engage in short-term market neutral trading in Canadian and U.S. liquid exchange-listed securities. The Fund has a capacity of $700M at the trading level.