Hedge fundsfund holders could not ignore it

"Hedge funds" funds French have received a boost on the part of Parliament. Order and order them opened immediately access to the use of the "reserve gates", according to the instructions issued by the Autorité des marchés financiers (AMF). These "Gates" enable managers to limit the amount of withdrawals from investors to a percentage of the net assets of the Fund. "Finally!" sigh the professionals at the head of those undertakings for collective investment in pared-down investment rules (Aria) weighing approximately EUR 30 billion through 400 Fund. For years, claiming it to be closer to international standards. In September 2007, the report Adhémar, commissioned by the regulator, gave them hope. Finally, it is in the urgency that the authorities have fulfilled their wishes. "These arrangements have been made in a context where management companies attracted the attention of the MFA on the challenges from the reduction of the liquidity of the"hedge funds"underlying that activate their"gates"", says Pauline Leclerc-glorious at the MFA.

Angel gesture

At the time where liquidity has become a central issue for all rated assets, this gesture is obviously Angel for managers. They can better manage the influx of redemptions of shares, since they have time to clear the cash market, without defect management and limiting the impact on the assets. Now, funds of funds have same weapons as the "hedge funds" underlying, since they can in turn enable "gates". Above all, they can slow down the frequency of calculation of the net asset value of the Fund. In addition, they have the right to suspend the calculation of the net asset value of their funds, the time to put in place such a device. "The leaders of UCITS hedge fund management companies must declare it formally to the MFA." "They are not from a posteriori control", note Pauline Leclerc-glorious.

Upon adoption of the measures Friday, adaptations have not dragged. "It would seem that it carries a weekly frequency to monthly", demonstrates Olivier Florin, Associate Director of Eraam. Other promoters of Aria funds have changed seriously their prospectus, changing the frequency of recovery, often from daily to monthly, the terms of subscription, the publication of the NAV, the regulation of takeovers, which can take two to three weeks, and incorporating the "gates" capped at 5 or 10 of assets.

The rules of the game have changed. "The underwriters had previously flexibility technically abnormal, insists Hugues Le Maire, Tocqueville Alternative Investments. Alternative daily management is in fact illiquid, while it is a great provider of liquidity to the markets. ""Hedge funds"fund holders could not ignore it. "From the start, AMF had been warned about poor liquidity, with a special box in each prospectus", said Olivier Kintgen, Director General of Eraam. The managers therefore adossaient the best that they could their portfolio to limit this constraint. "Liquidity we offer investors is in line with the liquidity of our"hedge funds"," said Christophe Chouard, Deputy General Manager of HDF Finance, which is not the need to change the rules. "A large number of investors are not happy that the promises are not required," he continued, stressing that the "gates" of the contractual funds of French law or in the Anglo-Saxon are usually specified at the beginning of the Fund. The Aria live are also affected by these measures, but must obtain new amenities and to inform their customers. This will require a little more time.