The hedge fund industry has been at the centre of heated debate with many pointing the finger squarely at the sector as the true cause of the global financial meltdown.
While many of us have scrambled to safety amid the falling debris, hedge fund managers have been forced to fight not only for their survival, but also their freedom from blame.
As part of this week’s cover story, IFA spoke with executives from HFA Asset Management, Select Asset Management, Mercer Investment Consulting, Ashton Advisors and the Alternative Investment Management Association Australia (AIMA) as part of a roundtable discussion.
As expected, with representatives from a number of Australia’s leading hedge fund managers, sparks flew.
When asked for their thoughts on investor perception that hedge funds were the cause of the meltdown, comments came thick and fast.
ven a tongue-in-cheek admission was made that the sector was also responsible for the assassination of former United States president John F Kennedy.
Jokes aside, the executives also provided interesting comments on their opinions of ASIC’s move to temporarily ban short-selling of all stocks.
“They banned financial short-selling in the UK, they banned [short-selling] financials in the US, but ASIC decided to ban everything and I think that was one of the greatest steps backwards for the industry in having that unilateral decision being made,” AIMA chairman Kim Ivey said.
Other topics covered were whether hedge funds need greater transparency and should charge fewer fees to survive.
“It all depends on how big you are and of course how well you can negotiate. But definitely there’s a trend,” Mercer Investment Consulting principal Harry Liem said.
“Now I see many, many good managers that have come now and they obviously said ‘look, we’re actually open again for business after so many years’.”
The relationship among managers, financial advisers and clients was also discussed, particularly in regard to the reaction to frozen redemptions of fund of hedge funds.
The decision to run a cover story on hedge fund managers was not to make martyrs out of them, but merely to allow those in the firing line a chance to air their views.
We hope you enjoy it.
