The challenge of reigning-in hedge funds through regulation and the need to improve disclosure requirements
Date
2008-12
Authors
Mutingwende, Russell R.
Journal Title
Journal ISSN
Volume Title
Publisher
Stellenbosch : Stellenbosch University
Abstract
This study aims to look at the definition of the group of alternative investments commonly
known as ‘hedge funds’, in order to better understand why regulatory bodies the world
over are vehemently working on introducing new legislation and guidelines as a means of
maintaining market security and integrity in order to ensure adequate investor protection.
This study posits that the two most viable options available to regulatory bodies to ensure
effective implementation of these changes are (i) to either further restrict access to hedge
funds and thereby curb their ‘retailization’ and/or (ii) to introduce rigorous levels of
disclosure on the part of hedge funds and their intermediaries.
It is the objective of this study to establish that for either of these options to be attained,
tangible improvement in both the quantity and quality of information disclosure from
hedge funds and their intermediaries about their positions, strategies and exposures in a
manner that would enable them to continue to provide the market efficiency-enhancing
services that they currently offer. After introducing all the key issues that have motivated
this resolve, the study looks at the current regulatory environment and the challenges
facing regulators such as the varying degrees of banking freedom offered by different
states and jurisdictions. Proposed changes to current legislation are also considered across
several jurisdictions. The results from the local market field study set the platform for
recommendations to be investigated in future studies in order to provide guidelines for the supervision of the hedge fund industry.
Description
Thesis (MComm (Business Management))--Stellenbosch University, 2008.
Keywords
Hedge funds, Regulation, Disclosure of information, Hedge funds legislation, Investments, Hedging, Dissertations -- Business management, Theses -- Business management