On Regulation System Of Hedge Fund

Hedge funds have gained great developments around the world and have become playing an important role in the world's financial market since 1990s. At the same time, hedge funds on global financial markets brought about systemic risk are increasingly a cause for concern, the regulation of hedge funds attracted more and more countries and international organizations regulatory concerns. China's emerging local hedge funds, and hedge funds overseas are eager to enter the Chinese market, the study on the supervision of hedge funds has a strong theoretical and practical significance. At present, some scholars have begun to study hedge funds and pointed out a number of constructive suggestions on the legal supervision of hedge funds. Although the study of hedge funds has been very profound internationally, the domestic study lagged behind both in the depth and profundity.The first part is an overview of hedge fund regulation. Jones Group is the first hedge fund in the world and its success stimulated the hedge funds development. The author defined the concept of hedge fund through a comparative analysis of various concepts. At the same time, because of the characteristics of hedge funds can easily cause a huge risk of the system, thus the research of regulation of hedge fund, including the establishment, operation, information disclosure etc. is particularly necessary.The second part elaborates regulation of hedge fund major countries. United States hedge fund regulation focuses on the investors' qualification, quantity, information disclosure, investment advisers. In addition to the former regulations, UK enacted HFSB Standards specifically for hedge funds in November 2007. " Hedge Funds Guidelines" and " Guidelines on Hedge Funds Reporting Requirements "promulgated by Hong Kong both are comprehensive legal documents in the world.Third part mainly introduces the regulatory framework of international organizations. The Basel Committee emphasizes on the hedge fund counterparties, including banks and brokerage business regulation. IOSCO stresses to enhance the transparency and money-laundering provisions of hedge funds. IMF emphasizes the protection of investors, ensure market integrity, as well as the risks of the system control. BIS and FSF are also point out many suggestions. The fourth discuses the status of hedge fund regulation of our country. China has large scale of private funds. With the progressive opening of financial markets, our country can easily attract the attention of hedge funds, we also have the condition hedge fund needs. However, there is no "hedge fund" in the laws, also have no restrictions of set up securities investment funds in private, even no regulations about foreign hedge fund. This resulted lack of protection for investors and disorderly competition in the market .It can also lead to credit risks and large-scale systemic risks.The fifth part is the suggestions of constructing our hedge fund legal supervision system. The macro level, establishing an indirect supervision mode, regulatory framework, regulatory principles , legislative system of regulation. In particular, it is necessary to make the legal status of hedge funds, through the definition of qualified investors, sponsors, qualified administrator to limit the establishment of hedge fund regulation, then control the share of fund flows, investment direction during the operation of hedge funds, and finally carried out on the disclosure of information provisions. Then encourage the government to take part in international cooperation.