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09

Hedge Funds Seen Gaining Market Influence in Passive Money Boom

By Tony Seruga

Hedge funds’ growing power may be distorting asset prices
Asset managers have warned U.K. regulator about this issue

The decade-long growth of cheap index-tracking funds is giving hedge funds an unexpected influence in setting market prices.

As investors hand more of their money to passive fund managers and active stock pickers get sidelined, hedge funds’ heft is being magnified. Active fund managers have complained to Britain’s financial regulator that increased index-tracking is distorting markets by allowing hedge funds with “short-term” outlooks to set prices that don’t reflect fundamentals…

Hedge Funds Seen Gaining Market Influence in Passive Money Boom

Categories : Hedge Funds

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