Hedge Funds Launch "Newcits" Funds Amid Euro Regulation
Guy Hurley said he’s not sweating European plans for new hedge-fund rules after leaving Bank of America Corp.’s Merrill Lynch & Co. a year ago to start an onshore fund that uses strategies such as merger arbitrage.
“It’s not material to us because we’re not a hedge fund, we’re a mutual fund,” Hurley, founder of HCM (UK) Ltd., said in an interview at the firm’s headquarters on Grafton Street in Mayfair, the heart of London’s hedge-fund district. “Because we are in the Ucits business, we fully comply with European regulations already.”
Ucits, European funds known by the acronym for Undertakings for Collective Investment in Transferable Securities, are the fastest-growing segment of the $1.7 trillion industry. Brevan Howard Asset Management LP, York Capital Management LLC, Marshall Wace LLP and rivals started more than 400 of them in the past two years to offer easier trading, more transparency and regulatory scrutiny than standard hedge funds. Source