Setting the stage for future growth
Hedge fund spin-off considerations
This growing trend has created a pool of hedge fund managers who have substantial portfolio management experience and a performance pedigree, but lack of experience in managing operations, technology and compliance.
With institutional investors and regulators demanding an unprecedented level of transparency and regulatory compliance, focus on middle and back-office functions is emerging as a key priority for the spin-off fund managers.
- A holistic approach to spin-off a hedge fund should involve five distinct characteristics:
1. Define its target operating model based on its strategic needs, growth plan, and technology capabilities
2. Lay-out an organisational structure in line with investor, business, and regulatory requirements
3. Develop a technology architecture which aligns with the current and future operating model
4. Identify regulatory considerations, and select and develop compliance solution structure
5. Develop a spin-off roadmap to identify and mitigate and potential risks and challenges
Performance issue 12 - September 2013
Performance is a triannual digest, dedicated to investment management professionals, which brings you the latest articles, news and market developments from Deloitte’s professionals and clients.