Turkey Talks H-Funds; Peru, Too

Financial regulators on both sides of the globe are welcoming hedge funds.

The Capital Markets Board of Turkey (SPK) has amended legislation that would allow the establishment of what most of the world calls hedge funds. The SPK, for reasons not explained, has decided to refer to them in its draft bill as “high-risk investment funds,” which will be available only to “qualified investors.” The bill seems to offer issuers and their investors a lot of freedom. According to an SPK release, “These funds, which can establish and administer their own portfolio without being subject to the limitations faced by other funds,” will have “their investment strategies... freely determined by the fund’s internal regulations.” What’s more, there will be “no restriction regarding the minimum investment amount for the fund investors or maximum investor numbers.”

Meanwhile, halfway across the world in Peru, SBS, the country’s banking, insurance and pension regulator, is allowing domestic pension fund managers to invest directly in hedge funds for the first time. The decision, which follows reform in March to allow indirect investment through structured products, came after an SBS study found that hedge funds would add the kind of diversification that would add value to the 3.7 million pension system affiliates.