The Need For Transparency In Hedge Fund

The capital market is a complex one, no doubt in that. There are many
investors who invest in various types of funds; however, very few have the
knowledge or expertise to understand the market and its technicalities
completely. Thus, even if recessions or bear markets makes the investors redeem
the investments in funds and shifting towards the assets, most do that without
the proper knowledge of how exactly that helps.



The hedge fund has changed the scenario further. The mutual funds market
used to operate mainly catering to those investors who had less knowledge of
the investment options. However, the hedge funds became popular among those
having better knowledge of the products. Initially, since the investors had
good knowledge of the market, the issue of the knowledge of the investment
managers never came up. However, with the changing market, the hedge fund
investors also started demanding that the investment managers have a good
knowledge of the market and the products.

On the other hand, there has been high competition among the portfolio
managers, who have developed their unique strategies to keep themselves at the
top of the chart and provide excellent strategy and result to their clients.
The increasing competition also resulted in them not agreeing to disclose their
trading methodologies. However, the hedge fund industry created a different
scenario altogether. It has already created a group of Accredited Investors who
have more than average knowledge of the working of the market and the flow of the
fund. Also these investors have a better understanding to judge which will be
the best area to invest their funds into. The knowledge led to the question of
transparency, since general way of trading did not allow the investors to gain
any knowledge about their investment and how the market was performing without
the help of the quarterly reports, the transparency became a major issue,
especially for those with high investments.
A solution to the problem of transparency arrived with Managed Account.
Each managed account is in the name of the investor and each investor can
monitor their accounts at any time. The Portfolio Managers also structure them
all identically and managed them in the same way as the pooled funds are used.
Thus the transparency problem is sorted out to a great extent.

Haidar
Capital Management
LLC, brainchild of
Said Haidar, provided a unique solution to the transparency problem as well.
They incorporated the Fund-Studio portfolio management system. With a proper
system in place, they better utilized their resources helping both their
managers and the investors in return. The investors could now track every move
in their account and the portfolio managers have a better way to reallocate and
resource the funds in the hedge fund scheme. Providing unprecedented growth to
the investors and recording high returns, Haidar Capital Management LLC of Said
Haidar became a huge success in the New York market. It fast created a major
market for itself and became one of the largest growing organizations of its
kind.

The growth along with customer satisfaction proves that there are ways
to create both without losing out on the business. 

Leave a Reply

Your email address will not be published. Required fields are marked *