Hedge fund code of conduct a distant reality

Date: Thursday, July 14, 2005
Author: http://www.portfolio-international.com

The Alternative Investment Management Association (AIMA) has set up its largest-ever working group to look into and formulate a response to the Financial Services Authority’s (FSA) consultation paper on regulating the hedge fund industry.

AIMA said the group would consider all aspects of the consultation paper and could not say yet what the outcome might be. It includes more than 50 of the association’s corporate UK members.

“Some newspaper reports said we are looking at establishing a code of conduct for hedge funds. This is not strictly true but we will address the suggestion of a code of conduct in our response to the FSA,” says Emma Mugridge, director at AIMA.

Mugridge said a code of conduct could be a long-term solution but it should be remembered hedge fund managers in the UK are already covered by certain FSA rules.

“Two thirds of Europe’s hedge fund managers are based in the UK and as investment managers they are already subject to various FSA regulations. A code of conduct may not be necessary and that is not something for AIMA to determine,” she explained.