Despite having risk management tools in place, a Thomson Reuters survey found that most asset managers and investors could not prevent losses during volatile summer markets this year.
The survey, which polled over 90 buy side trading firms, found that 73 per cent of asset managers and 66 per cent of investors reported ineffective systems in terms of preventing losses.
“The hedge fund industry is coming under increased regulatory scrutiny across the globe and controlling risk has become increasingly important for investors and managers," says Gerry Buggy, global head of Enterprise Content at Thomson Reuters. "The results of our poll however, confirm that a number of hedge funds are still locked into legacy technology that lacks the agility to adequately respond to changing business and regulatory drivers."
Other key findings of the survey show that 93 per cent of respondents did not think Dodd-Frank would prevent another financial crisis and reported low expectations for the effectiveness of relevant components in the Act impacting the hedge fund industry.
