ASIC seeks to regulate $46.8 billion hedge fund sector
The popularity of hedge funds seems to have drawn the attention of the Australian Securities and Investments Commission (ASIC), which is seeking to provide further disclosure to the retail investors of the $46.8 billion sector.
Australia is home to the largest hedge fund sector in the Asia Pacific, $32.7 billion of which is managed by Australian hedge fund managers, while the rest is invested in Australian funds managed by hedge fund managers.
Retail and high-net-worth investors make up 64 per cent of the sector, while Australian (25 per cent) and international (11 per cent) institutional investors make up the remainder.
ASIC is seeking to provide those retail investors with increased transparency by introducing disclosure principles and benchmarks for hedge funds to be addressed in the Product Disclosure Statement (PDS).
ASIC stated that increased disclosure would help “to make comparisons between the products and business models of different issuers more straightforward”.
The regulator is currently seeking submissions about the likely compliance costs, the effect on competition and other impacts, costs and benefits surrounding increasing disclosure for hedge funds.
The closing date for submissions is 21 April, 2011.
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