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Hedge Funds Vs Managed accounts

Discussion in 'Forex Beginner Q&A' started by Murtadha, Dec 13, 2008.

  1. Murtadha

    Murtadha New Member

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    Occupation:
    Money Manager
    Location:
    Melaka
    The growth of the forex hedge fund industry has been well documented in the media and through heightened interest the regulators have taken in the sector. No longer just a domain for the ultra high net worth investor and secretive private banking sector, hedge funds now play a growing role in portfolio diversification and liability-driven investing, and hence fall inside the scope of pension funds, asset managers, institutional investors and retail investors.

    Unregulated and secretive – forex hedge funds have produced awe and bewilderment for investors when providing stellar returns; and fear and loathing when they have lost money and where collapsing hedge fund managers disappear with investor’s cash.

    Institutional investors see the main barriers to further growth in the industry as being the lack of TRANSPARENCY, RISK CONTROL, and LACK OF REGULATON.* However, when one studies hedge fund failures, investment risk only results in approximately 40% of all failures whilst operational issues result in 60% of all failures. Furthermore, operational failures are never the result of just one event – they take the form of a combination of items such as misrepresentation, inadequate resources, misappropriation of funds and unauthorized trading.**

    Currency Managed Accounts are the key to addressing the above-mentioned investors concerns and helping to reduce the risks associated with hedge funds.

    Currency Managed Accounts help take forex hedge funds and their investment strategies further into the main stream institutional universe, where their benefits can give substantial upside to investment portfolios – whilst helping protect against the perceived downside of investing in a risky and lightly regulated environment.

    Managed Accounts, with daily position level transparency, legal framework and detailed due diligence, are able to provide that essential safety net. Daily position level transparency results in daily valuations of portfolios and enhanced risk management for end-users. Should an event arise in which risk and legal parameters are broken, the enhanced liquidity results in quicker liquidations and exit of the hedge fund manager in question.

    The above was prepared by MSS Capital for the Managed Accounts USA 2007 conference organized by Terrapinn.

    *Deutsche Bank 2003

    **Capco Report 2003
     
  2. Cyclon

    Cyclon New Member

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    This seems like an advertisement for a conference since it casts aspersions on hedge funds but a glowing light on managed accts. But if the issues that lead to problems are operational what prevents mismanagement in that industry any more than the other?

    If companies just fold and walk away with someone's money in any and all industries, including investment banking giants, where are there any protections for investors in these small managed accts firms?

    Just as in the 1990's experts predicted that when the stock market bubble burst there would be revelations of accounting scandals so too when the housing bubble burst. We are just now getting to see the inherent greed and back room deals come to light. It has been seen that these issues had their roots in governments and corporations on a massive scale globally.

    Therefore I highly discount this consortium's assurances. I just don't see things changing even when regulators get involved, in fact often they just hide the real underbelly.

    Cheers,
    Cyclon
     
  3. masterbroker

    masterbroker New Member

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    Forex trade is a good market and when you get the right broker on your side, it is a plus point. My brother is involved in the forex market and he deals with quite a few so I don’t really know which ones he is onto. But, he takes the forex brokers from an online list where they can be sorted according to their country and trading platform. I hope that you will get considerable help from this list.
    Happy Trading
     
    #3 masterbroker, Jan 27, 2009
    Last edited by a moderator: Jan 27, 2009
  4. Mirkinbar

    Mirkinbar New Member

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    just curious
    do you need to be licensed to run a managed account?
     
  5. forexboy

    forexboy New Member

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    Searching for a good and reliable broker should be the most important part that a trader should consider because what happen when you need some of their service support and there's no one else to help you around.
     
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