Hedge Funds Marketing Insider Trading

Funds See Insider Trading Probe as Marketing Opportunity

While the insider trading investigation that has smeared some large hedge funds and mutual funds, competitors are looking at this event as an opportunity to attract new investors.  Quantitative hedge funds are particularly looking to score big off the insider trading probe by marketing their funds to investors as an alternative that relies solely on computer-driven models. 

The "expert network" insider trading probe has ensnared some big-name hedge funds and mutual funds--the likes of SAC Capital, Citadel, Janus and Wellington Management. This is something competitors see as an opportunity.

Quantitative funds in particular think a marketing opportunity has been handed to them, Fortune reports. They have an interesting product story to tell as the investigation unfolds. These guys, after all, do not use new-age independent research or traditional research. They rely on their computer-driven models, so they are virtually immune to these sorts of scandals--or so they say.

Larger hedge funds and funds of funds also have an interesting pitch: they have highly developed compliance departments that make illegal insider trading much less likely. This has been a marketing point for a while for some firms. But it's nothing like a little scandal to inject a bit of urgency into their message. Source

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Tags:  Hedge Funds Marketing,  Insider Trading, Hedge Funds Marketing Insider Trading Investigation, Quantitative Hedge Funds Marketing