The History of Hedge Fund Regulation in the United States

The hedge fund industry in the United States has evolved from a niche market participant in the early 1950s to a major industry operating in international financial markets today. Hedge funds in the United States were originally privately-held, privately-managed investment funds, unregistered and exempt from federal securities regulation. With increasing investor demand for hedge funds and significant growth of the hedge fund industry came a tectonic shift in the regulatory framework applicable to the industry.

Several core features characterize the hedge fund industry. A hedge fund’s goal is to earn for its investors a high rate of return on their … Read more