No signs of panic seen !! Hedge fund inflows may fall
Will hedge funds change their charter post Sebi's P-Note policy or will they look at an alternative way of investing in India? According to analysts, hedge fund inflows going into the market is around 10-30%.
Macquarie said 20-30% of total participants would be unregulated hedge funds. There are around 1,000 hedge funds, which are operating worldwide. About 70-80% operate from US. Most hedge funds came to India in early 2002 as they did not want to be regulated
So, what is the view of hedge funds on the markets? Most hedge funds across the world said India might see volumes drop down in the short- to medium-term. They feel there will be a likely level-playing field after new categories of investors like pension funds and retirement funds get recognised. They also don't see panic in the market. According to analysts, there are other investment options. Hedge funds need to change their charter to convert from long-short to long only funds. Investors would opt for hedge funds or for higher returns. If hedge funds invest in long only funds then investors may invest via pension funds. Hedge funds may also look to registering under their home regulator.
On IPOs and right issue, analysts feel that the size and subscription of issue will be affected. There is no much concern about Tata Steel.
On one side there could be some redemption or there could be some hedge funds which will not be investing in India.
The most important factor here, analysts said, is that Sebi’s body language and its intention was not too control capital but was transparency.
Macquarie said 20-30% of total participants would be unregulated hedge funds. There are around 1,000 hedge funds, which are operating worldwide. About 70-80% operate from US. Most hedge funds came to India in early 2002 as they did not want to be regulated
So, what is the view of hedge funds on the markets? Most hedge funds across the world said India might see volumes drop down in the short- to medium-term. They feel there will be a likely level-playing field after new categories of investors like pension funds and retirement funds get recognised. They also don't see panic in the market. According to analysts, there are other investment options. Hedge funds need to change their charter to convert from long-short to long only funds. Investors would opt for hedge funds or for higher returns. If hedge funds invest in long only funds then investors may invest via pension funds. Hedge funds may also look to registering under their home regulator.
On IPOs and right issue, analysts feel that the size and subscription of issue will be affected. There is no much concern about Tata Steel.
On one side there could be some redemption or there could be some hedge funds which will not be investing in India.
The most important factor here, analysts said, is that Sebi’s body language and its intention was not too control capital but was transparency.
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