Monday, 20 October 2014
Last updated 2 days ago
Jul 11 2007 | 2:42pm ET
Closing a loophole opened by a federal court decision, the Securities and Exchange Commission today banned hedge funds from misleading investors. But Bulldog Investor’s Phillip Goldstein says more rules are not the answer to fraud.
The new rule, which unlike the controversial hedge fund registration rule, enjoyed unanimous support on the five-member commission, and allows the SEC to sue hedge funds for lying about investment strategies, performance, a manager’s experience or risk. The SEC’s authority to do so was called into question by the Goldstein decision, when the Court of Appeals in Washington tossed the agency’s registration rule.
“This rule will give the commission an important tool to help us police this market to deter misconduct,” SEC Chairman Christopher Cox said.
While Goldstein lauds the SEC intentions, he thinks the Commission needs to do more than just come up with new legislation.
“It’s like if there are a lot of bank robberies in the neighborhood, then you don’t need more laws against bank robberies; you just have to go out and arrest the robbers” Goldstein told FINalternatives.
“If managers lied to investors, they can get sued anyway so what’s the difference? They should spend more of their resources going after the fraudsters than adopting new rules. Unfortunately, they’re very slow about acting in a lot of cases.”
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Sep 30 2014 | 9:29am ET
The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…
Most traders agree that proper risk management is the key to successful trading. However, many traders depend on the deeply flawed measure of standard deviation as a benchmark of risk. Here we put it ...