Hedge Fund Offering Memorandum

According to Lionel Barber, editor of the Financial Times, "Hedge funds are the vanguard of a financial revolution. Once little known and secret fringe forces, they have become leading actors in reshaping the business world. As active investors capable of mobilizing billions of dollars of capital, these new institutions have become extremely powerful and impressive innovative. "

Here are some tips from the 2007 State Street Hedge Fund Research Study. I can not provide the report because it has been requested and is not yet available online. There is a history here, "State Street study shows that institutional investment - in hedge funds is increasing, which is also included in the report.

Among the greatest perceived risks hedge funds by institutions cited in the study are the overall risk (20%) and loss of investment (20%). Here are some things to look for before investing in a hedge fund;

1. Ownership Structure - Consideration of the ownership structure to ensure that conditions, including refund policies and locations to meet expectations and compensation of employees that motivates performance.

2. Membership Strategy - Analyze current and historical statement to confirm their compliance strategy specific hedge fund for which the manager has been hired. This might be managers who have become investors opportunistic time ago the style comes under pressure to perform.

3. Background Checks - Conduct a full audit history of hedge funds and its leaders, including their history, the NASD and NFA filings, two civil and criminal cases. full confidence in your manager is essential to a successful strategy.

4. Trading - a thorough analysis of securities hedge fund and deal with compensation procedures. If these procedures are carried out internally or through a third-party service, details can provide insight into the philosophy of risk management fund and the fee structure.

5. Documentation - Review of hedge fund or separate account documentation, including ADV, offering circular and disclosure documents. For plan sponsors in the United States, Employee Retirement Income Security Act of qualifications, examinations of the CFTC and the SEC filings, registrations, and evasion as SAS 99, if necessary.

6. Internal Procedure - Review internal procedures of hedge fund manager. It is important to know what the task manager conducts itself and what duties are performed by third party service providers. It is important to ensure appropriate risk controls and procedures are in place.

Hedge funds are not equal in the level of information they provide to investors, but it is important to know all you can.