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Compliance September 20, 2004
Survey: Endowments and Foundations Favor Hedge Fund Regulation
September 20, 2004 (PLANSPONSOR.com) - The majority
of endowments and foundations that invest in hedge funds
support the proposed regulation by the Security and Exchange
Commission (SEC) that would require these alternative
investment vehicles to register as Registered Investment
Advisors (RIA).
Reported by Kip McDaniel
>According to the Hennessee Group’s 2004 Foundation and Endowment Survey of 46 foundations and endowments that invested in hedge funds, 59% were in favor of the proposal requiring hedge funds to register with the SEC under the Investment Advisors Act of 1940.
>However, the 31% who did not support such a move manage three times as much capital and allocate 46% more to hedge funds. They also have 50% more experience investing in hedge funds.
>The survey also finds that those who favor registration have on average 15% of their assets allocated to hedge funds, with 8% invested directly and 7% invested through a fund of hedge funds vehicle. An average of 22% of assets are in hedge funds for those who oppose registration, with 15% being invested directly.