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Interview with Jeff Short & Keiran Hutchison – Although introduced a few years back, Financial Interpretation Number 48 (FIN 48) has recently become a high priority focus for Cayman fund managers involved in the liquidation of their fund(s). “Initially people were uncertain as to whether or not cheques would need to be written to various tax authorities around the world,” explains Jeff Short (AM partner) Ernst & Young.
But that is now becoming reality. Continues Short: “As they wind down their funds, investment managers and directors don’t want to find themselves exposed to potential off balance sheet tax liabilities at
By Canover Watson, managing director, Admiral Administration – Worldwide, the hedge fund administration industry continues to go through an accelerating phase of consolidation. This is driven by the increasing sophistication of administration, with significant concomitant investment required to install and manage world-class technology platforms that enable administrators to meet these challenges and which offer economies of scale. While the systems have increased in complexity and cost, the skills required to provide these services have also increased dramatically, and the exponential increase in the use of OTC derivatives and illiquid assets has increased the complexity of middle and back office processes.
By Ras Sipko, chief operating officer, Koger – Fund administrators are today under intense pressure to perform as they face greater scrutiny than ever before from clients.
Showing that they are operating within industry best practices to help boost their clients’ investor confidence couldn’t be more important, particularly over the past two years as investors demand greater transparency and want information to be delivered at speed and with accuracy, alongside regulatory changes.
To show that they are working to such high standards and within best practices, it has never been more important for fund administrators to demonstrate that they are
By Ashley Gunning, Walkers – Twelve months on from the Weavering decision it is interesting to look at how the approach to corporate governance has evolved amongst our clients. Although the decision did not in itself create any new law, it has forced issues regarding independent directors and best practice to the top of the agenda. Weavering effectively provided a pertinent reminder to directors of investment funds as to the nature and extent of their fiduciary duties and how delegating functions to service providers and then taking a back seat can go badly wrong.
To see how attitudes have changed,
WyeTree Asset Management has launched its latest fund, the WyeTree Yield Distribution Fund, as an Irish master/feeder structure.
The fund will be managed by a London-based team led by Judith Sciamma (pictured) and will be investing in the mortgage-backed securities and real estate markets, using WyeTree’s model-based analysis and research techniques.
It will seek to target an annual yield of four to six per cent with low volatility.
Carne Group, a provider of governance and oversight solutions for the fund management industry, helped to structure the feeder company and a master unit trust for WyeTree.
WyeTree will make use of
Interview with Darren Stainrod – “In the coming year, the biggest impact on administrators is going to be FATCA and the amount of reporting on investors that’s going to be required and whether that reporting is going to be to the Cayman government or directly to the IRS,” comments Darren Stainrod, head of UBS Fund Services, Cayman.
Over and above striking NAVs, providing valuations and reconciling positions, the emphasis for hedge fund administrators is now on middle-office “value-add” services as regulatory reporting requirements kick in.
FATCA is a hugely pervasive piece of regulation. Notes Stainrod: “It’s going to be the
By James Williams – With the search for alpha harder than ever, hedge fund managers are subsequently becoming more creative in how they trade: greater use of synthetic products and OTC derivatives has made the trading environment more complex, requiring hedge fund administrators to deliver better, more transparent reporting solutions, and provide close to real time NAVs and daily reconciliations across a range of asset classes.
Hedge fund administrators are responding to these demands in various ways. One trend in Cayman this year has been for smaller independent specialists, such as Admiral Administration, to consolidate their position in light of
Sapient Global Markets has been certified under the Eris Certified Implementation Partner Programme.
With firms looking for new ways to bring OTC products to market in response to regulatory mandates including Dodd-Frank, Sapient Global Markets will use its derivative industry expertise to help market participants quickly and efficiently convert existing and new OTC interest rate swap products to the clearinghouse model.
Under the agreement, Sapient Global Markets will provide client training, programme management and technology expertise including integration of clearing and trading systems as well as support for other technology solutions, to help firms take advantage of the Eris
By James Williams – With risk/on, risk/off sentiment having dominated the markets for the last 18 months, trade volumes among hedge funds – which prime brokers rely on – have dropped away. This has impacted on another key revenue driver – leverage.
Tim Wannenmacher, Head of Prime Services Asia Pacific, UBS, Hong Kong, notes: “Leverage levels went up in Q1 but came off in May and have been fairly muted since. However, while we have seen lower leverage numbers – on average, 1.5 to 2x gross – we have seen more activity on the short side.”
Wannenmacher goes on to
CAIS, the financial-technology solutions provider, has launched the CAIS Exchange, the first online alternative investment marketplace designed for the wealth management industry.
The CAIS Exchange (CAIS-X) offers access to a broad menu of top-tier funds and products, independent due diligence reports provided by Mercer, portfolio construction and analytics tools and an electronic subscription and redemption process for streamlined trade execution.
CAIS-X is the first complete solution to offer access, oversight and execution in a single venue, empowering wealth management professionals with institutional quality products coupled with time-saving operational efficiency.
The funds and products that list on CAIS-X represent a broad
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