This Comment examines the current debate surrounding increasing regulations on hedge funds in order to provide better investor protection. The author starts out by explaining what a hedge fund is and how they have grown in importance over the years. The author then discusses some of the recent trends in the hedge fund industry that have concerned the SEC, such as increases in fraud, conflicts of interest, and marketing to less sophisticated investors. Next, the author explains the current state of regulations for the hedge fund industry as well as the rationales for such limited regulations. The author then discusses and does a cost-benefit analysis of several potential plans to increase regulation of hedge funds. HE concludes that increased regulation is not needed, but that the SEC should try to establish a custom of greater disclosure and transparency to investors through the use of policy statements.
Erik J. Greupner,
Hedge Funds Are Headed Down-Market: A Call for Increased Regulation?,
San Diego L. Rev.
Available at: https://digital.sandiego.edu/sdlr/vol40/iss4/16