MSN MoneyCentral – This autumn in London, a striking new trend is afoot in the hedge fund world: increasing numbers of funds are talking to lawyers before placing trades in the credit markets.
Some funds are apparently so nervous about breaching market abuse rules that they prefer to pay for advice now – rather than risk facing a scandal later.
“These days we are getting a lot of pre-trade calls from hedge funds,” says Darren Fox, a partner at Simmons & Simmons, the law firm which has a leading London hedge fund business. “They want advice before they make a trade.”
To some observers, this highlights a welcome trend: namely that, as hedge funds become larger, they are paying increasing attention to regulatory issues. “Compliance is something most of us take very seriously now,” says the head of one of Europe’s largest credit funds.
