Funds Hub

Money managers under the microscope

Theirs not to reason why…

November 10, 2010

Hedge funds have had a tough time since the onset of the credit crisis, what with some poor performance in 2008, looming regulations from the U.S. and Europe, and the general vilification of bankers and financiers in recent years.

However, their plight was thrown into a whole new light yesterday at this week’s Hedge 2010 conference in London’s Canary Wharf, where Caroline Hoare, CEO of hedge fund firm GLC, drew a comparison with the charge of the light brigade.

In Tennyson’s famous poem, the unfortunate 600 have to cope with “cannon to the right of them, cannon to the left of them, cannon behind them”, volleying and thundering.

“I think we’re in quite a tight spot,” Hoare told the conference, describing both her dislike of much of the new regulation that hedge funds are facing, and explaining how the industry is still perceived to be “secretive, overpaid and parasites”.

For those still confused by the analogy, the cannon to the right are the EU, in particular the AIFM Directive. The cannon to the right is regulation from the SEC. And cannon behind them are “the press, the general public, the taxman and our own troops wounding us with friendly fire”.

Of course, the moment in the poem that Hoare is describing, when cannon are behind them rather than in front of them, is not the Light Brigade’s charge but its full-scale retreat after the charge. Is this the hedge fund industry’s current position? And who was it who blundered?

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