Hedge Fund Marketing Ban Erased With Stroke Of Obama's Pen

Apr 9 2012 | 11:16am ET

An 80-year-old rule that has prevented the hedge fund industry from advertising to the public became history on Thursday, when President Barack Obama signed a wide-ranging jobs-creation bill that also abolished the longstanding ban.

The JOBS Act seeks to do many things to help start-up companies. But it also eliminates a provision in Depression-era securities law that bans marketing of privately-issued securities.

Hedge funds' new ability to market themselves is expected to be finalized by the Securities and Exchange Commission in about three months.

The JOBS Act does not, however, make hedge funds available to the general public. The new law does not alter the definition of "accredited investor," meaning that only those with $1 million in net worth will be able to put their money with hedge funds.

"This is an action whose time has come," Hedge Fund Association President Mitch Ackles said. "Now that many hedge fund managers are required to register with the SEC, the strongest reason for the ban on hedge fund advertising has been removed."


In Depth

Star Fund Managers Battered By Rocky Ride In Yields, Currencies

May 28 2015 | 6:05am ET

Some of the biggest names in the investment world have been whipsawed by the recent...

Lifestyle

Yale Receives $150 Million Gift from Blackstone’s Schwarzman

May 12 2015 | 12:10am ET

Yale University announced it has received a $150 million gift from Blackstone Group...

Guest Contributor

When Less is More: The Case for Concentrated Equity Strategies

Jun 1 2015 | 7:59am ET

The conventional wisdom is that wide diversification is the “holy grail,” as...

 

Sponsored Content

Editor's Note