Special Reports

Interview with Lonnie Macdonald, UMB Fund Services – “I get RFPs from clients all the time for complete middle-office services,” comments Lonnie Macdonald, president of JD Clark & Company, the hedge fund administration arm of UMB Fund Services. “We need to be there to deliver them.” »

Interview with Jack Seibald, Concept Capital – Unless an introducing broker can demonstrate a wide array of services to support clients’ needs on one hand, and instil robust operational risk controls to satisfy the increased demands of clearing houses on the other, they won’t remain competitive in today’s world. Cognisant of this, Concept Capital has moved quickly in recent years to build a wide range of services for the investment management community. »

Interview with Ted Jasinski, Admiral Administration – The emergence of esoteric products such as private equity-type hybrid funds means the alternatives space is starting to get a whole lot more alternative, according to Ted Jasinski, general manager of Admiral Administration’s Richmond-based office. »

By Ras Sipko – The alternative investment industry has had to reinvent itself over the past few years following the financial crisis, which has resulted in the emergence of a number of hybrid schemes that make use of both hedge fund and private equity strategies.  »

By James Williams – Last year was a dismal one for hedge fund managers, who as a group plunged into negative territory for the second time in four years, and so far 2012 hasn’t been much better. Although most strategies have made money this year, they have lagged buoyant – some would say irrationally so – stock markets by some distance. »

By Doug Nairne - One of the most important changes in the global financial industry over the past three years, and indeed the business environment as a whole, is the increased importance placed upon due diligence. That means paying closer attention not just to counterparties in order to detect any evidence of fraud – although this is certainly a vital component – but also wider issues, especially legal ones, to see whether they could have any detrimental effect on a firm’s business. »

By Simon Gray - Risk is the element that hedge fund managers above all others, are supposed to thrive on, but members of the industry long ago understood that there are many more facets to the concept than the market volatility that brings opportunities to the strong-nerved. Indeed, the past few years have highlighted the factors memorably described by US Secretary of Defence Donald Rumsfeld, in another context, as “unknown unknowns” – risks that could not be protected against because their very possibility was not conceived of. »

By Paul Compton - The traumatic crisis that engulfed the industry two years ago prompted a renewed concern among many hedge fund managers to gain control over their positions and exposures. Traumatised investors started asking managers many more questions about how positions were being valued, and even, in the wake of Madoff, whether the assets the fund claimed actually existed. This greater activism on the part of investors has turned out to be a lasting phenomenon, with managers under pressure to answer questions continually about their investment exposures and operational risk. »

By Lance Smith - The market turbulence of the past three years has exposed a number of flaws and limitations in traditional approaches to risk management. In the aftermath of the crisis, investors are increasingly pressuring alternative investment managers to ensure the most advanced and appropriate tools and methodologies are being used to deliver the most robust risk management process possible. »

By Simon Gray – The alternative investment management industry has already had to come to terms with a wholesale shake-up in attitudes toward risk assessment and management in response to demand from investors. They are no longer willing to take on trust promises that managers are doing what they say they’re doing. In addition, investors need assurance that managers are equipped with all the tools and system necessary to protect themselves not only against the predictable volatility of markets but unlikely and improbable events too. »