Progress report
An assessment of hedge fund YTD performance in the face of renewed fears for a potential eurozone crash Read More
06/04/2011
Comment: Colin MacKay
It is not surprising that Cayman, as the preferred domicile for an estimated 80% of the world’s hedge funds, is experiencing the same industry trends being reported elsewhere in the alternative investment management community. After the difficulties domestically and internationally which followed the 2008 financial crisis, the Cayman industry has witnessed a period of consolidation, reorganisation and retooling which is now manifesting itself in a sustained period of recovery.
According to statistics published by the Cayman Islands Monetary Authority (Cima), funds registered with Cima, which include those registered, licensed or administered in Cayman, have demonstrated sustained growth since the end of the first quarter of 2010 and are heading back to the record highs of 2008. With month-on-month growth trends, it is expected that the total number of funds registered with Cima will break through the 10,000-barrier for the first time during 2011.
Aima Cayman, the local representative of Aima’s global network, serves as the voice of the Cayman alternative investment management industry. Established in 2006, Aima Cayman works closely with Cima, the Cayman Islands government and local legislators to ensure the adoption of sound practices within the industry, as well as to help shape and direct local and international regulation and legislation.
Furthermore, Aima Cayman is a leading member of Cayman Finance, the broader financial services representative body in Cayman, and has established a structured educational programme aimed, principally, at new professional staff entering the industry which will run throughout the year. This programme is complemented by external speakers and presentations aimed at encouraging debate on local and international issues that impact the industry.
Over the past year, Aima has engaged in detail with Cima on various initiatives aimed at improving the means and processes by which it executes its regulatory functions. These include Cima’s movements towards online filings and data collection which will guarantee the speed of response which is a trademark of the Cayman industry at large.
Additionally, Aima has participated in the industry consultation around the EU Alternative Investment Fund Managers (AIFM) Directive, which allowed Cima to provide detailed responses to the regulatory consultation undertaken in late 2010. As a result, the final text retained many of the concessions sought by the industry at large, including the retention of the private placement provisions during the transition phase and the passporting initiatives thereafter.
The detail of the regulations and implementation will be important and Aima and Cayman Finance will continue to educate and inform commentators and parliamentarians to ensure that all aspects of the operation of the industry are taken into account in determining the detail of the implementation provisions.
While external pressures have required significant focus in recent years, the strength and depth of the Cayman industry remains of critical importance to Aima and its membership. Maintaining
Cayman’s market-leading position relies not only on co-operative engagement with Cima and the Cayman government, it also requires the local industry to maintain the technical expertise,
efficiency and cost-effectiveness which attracted the majority of the world’s managers to its shores. Despite the economic pressures of the last two years, Cayman appears in rude health, with
new service providers setting up on a regular basis and existing businesses recruiting and planning for growth, indicating broad confidence in the longevity of the industry, and of the Cayman
Islands.
Colin MacKay is head of Aima Cayman’s education and research committee
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60 seconds with... Kenneth Turchin
CAN YOU DESCRIBE YOUR CURRENT ROLE?
I have worked in public accounting and hedge funds and in the past eight years have been selling middle- and back-office services to the alternate investment industry. My role is to build relationships with clients, teach them about SS&C’s products and services, and ensure seamless transactions every time the firm launches a new fund.
IF YOU WERE DOWN TO YOUR LAST £1,000, HOW WOULD YOU INVEST IT?
I would buy THREE shares in Apple and hope for a repeat 383% return in the next five years.
WHAT WOULD YOU DO IF YOU WERE IN PRESIDENT OBAMA’S SHOES?
That’s one pair of size 12 shoes I do not want to be in!
WHO WOULD PLAY YOU IF THEY MADE A MOVIE ABOUT YOUR FIRM?
Kevin Bacon. He is a versatile actor and the centre of the entertainment universe. I am in sales. Everyone in the industry would be linked to me in six steps or less. My client list would be ridiculous.
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