Study of US hedge fund, PE managers reveals optimism
The Trump administration is good news for hedge funds and private equity funds according to a new survey.
Global fintech firm Kroger found that 56% of fund executives believe regulatory enforcement has decreased under Trump and 85% say the US regulatory environment is more relaxed than internationally.
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More than three quarters of fund managers say that regulatory and compliance issues are less of a concern now than in the past but a similar share believe the Trump administration will increase regulatory enforcement in the future.
"It's clear from the data that fund managers see the regulatory and enforcement climate as having eased in the US, especially compared with that in the UK and Europe. Today's environment has led in the short term to somewhat less of a worry about compliance vs. reputational risk, although that scenario could change in the future," said Ras Sipko, KOGER chief operating officer.
Increase in cyber, reputational risk
While fund managers are less concerned about regulatory issues, they are increasingly worried about other risks.
Cybersecurity threats are the top concern of 73% of respondents, ranking higher than a market correction (67%), geopolitical risk (38%), and economic downturn in the US or internationally (31%).
"In terms of general risk, cybersecurity emerging as fund managers' top concern is understandable given recent data breaches in other sectors. In fact, 96% of the survey respondents agree that many investment firms could be compelled to cease operations if private e-mails were made public, as has happened in other industries," Sipko said
The survey also revealed that two thirds of asset managers will consider exposure to digital currency in the next few years: 24% in two years or less and 28% in three to four years. 36% of funds say they will never consider exposure to digital currency.
