Scotsman – BRITAIN’S financial regulator yesterday said hedge funds could be suitable vehicles for private investors, but that the risks could be lessened by not putting all their eggs in one basket.
John Tiner, chief executive of the Financial Services Authority, said: “We think it’s reasonable for retail investors to get exposure to the hedge-fund sector, but without the concentrated risk of investing in a single-strategy hedge fund.”
Tiner, speaking after the annual meeting of the FSA, said one way around the issue was for private investors to put their money in a “fund of hedge funds” to spread the risk. Despite his relative relaxed stance on London’s 300 hedge funds, 30 of which the regulator has picked out for special monitoring, Tiner said in his speech to the meeting that vigilance on complex products was more necessary than ever.
He said that although the year to March 2006 had been a strong one for financial markets, this was just the time for investors and financial practitioners to be vigilant.
