KPMG

Hedge fund managers making significant investments to comply with global regulatory changes: industry survey

A global survey of hedge fund managers reveals that they are making significant investments in their firms’ infrastructure to comply with new regulatory requirements. According to The Cost of Compliance, a new report produced by KPMG International, the Alternative Investment Management Association (AIMA) and the Managed Funds Association (MFA), the average spend on compliance was at least $700,000 (£420,000) for small fund managers, $6m for medium-size fund managers and $14m for large fund managers.

The survey, which is one of the largest global surveys of hedge fund managers, was conducted between May and August of this year and includes the views of 200 hedge fund managers representing more than $910bn in assets under management (AUM). It also includes in-depth interviews with managers from North America, Europe and Asia.

The study found that the hedge fund industry has already invested heavily in compliance efforts to meet new global regulations, having spent more than $3bn to date on compliance costs. Hedge fund managers were found to be spending anywhere between five per cent and upwards of 10 per cent of their operating costs on compliance technology, headcount and strategy…

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