Dubai Hedge Fund and Private Equity Activity

Dubai Hedge Fund and Private Equity Activity Trend

While Dubai is a tourism hotbed and most well known for its modern architecture, indoor ski slopes and record numbers of tourists it is fast positioning itself as the financial center for northern Africa and the middle east as a whole. There are over 400 investment firms now based in or that have plans to build offices in the Dubai Financial Center. The ease of investment regulations and low taxes have attracted hundreds of professionals to the area.

It was recently announced that Dubai International Capital (DIC) invested a 9.9% stake in an American hedge fund Och-Ziff earlier this month. Other US investment firms that have sold pieces of their firms to investment groups in Dubai include The Carlyle Group and Apollo Management. Each has resulted inminority ownership of less than 15%, but I believe we just starting to see the beginning of a trend here. More up and coming financial centers such as China, Brazil, and the United Arab Emirates will be playing catch-up to other financial centers by making large investments in US and UK based investment firms.

- Richard

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Unknown said...

If you are an investor in hedge funds, what you need to know is that any hedge fund can go belly up. That’s right, any of them. You cannot out think someone who while running a hedge fund, is trying to defraud you.

Be Well!

Richard Wilson said...

True, but I think you could say something similar about many types of alternative investments and even some traditional ones. If you like your energy company, small cap stock, private equity firm, master limited partnership, small cap growth fund of fund, real estate investment group, etc. you should know that any of them could go belly up.

I do agree that some hedge fund investors have lost massive amounts of money through turbulent markets or as you suggested by a fraud who is always four questions ahead of investors trying to diligently invest their money.

If you work in forex than you are probably similar to me in that it is tiring of reading reports on the 20 hedge fund professionals who make headlines for fraudulently losing millions of investor's capital when there are over 60,000 other hedge fund professionals playing by the rules and running honest businesses. In general the media (and any widely used dictionary for that matter) defines hedge funds as highly levered risky investment vehicles and that is just not the case with at least half of the 8,000-14,000 funds out there.

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