The Rise of Shadow Administration
In recent years, hedge fund transparency has vastly improved due in large part to demand from institutional investors looking to enhance their risk management and governance practices. However, there are still a number of questions about hedge fund management and performance fees. While the sheer size of these fees has sparked concerns, one often overlooked element is their accuracy. Hedge fund assets are increasingly being held in separate accounts that don’t have the benefit of independent third party administration and consequently, risks emerge that the fees investors are paying may not be calculated in a way that's consistent with related investment management agreements.
In a recent AlphaQ article, Mark Weir, Senior Vice President responsible for middle office operations, discusses the rise of shadow administration and the role it plays in ensuring the accuracy of hedge fund fees.
Read the full article.