Research On Legal Supervision Mechanism Of Transnational Hedge Fund

Since the hedge fund has been boomed in the late1940s, it is becoming a kindof fund which pursuits excess profit and absolute return. Most hedge funds areprivate funds which the market expansion extend to the entire world, due to excessprofit and absolute return. Nowadays, as it is characterised by transnational, thehedge funds we have mentioned before are transnational hedge fund actually. Hedgefund consists of offshore hedge funds and onshore hedge funds which have externalinvestment.At the very beginning, because of its high profits, hedge fund attractedmounts of investors through short sales mechanism and capital leverage. However,along with the changing of the market and hedge fund itself, the investment risk inhedge fund is higer than ever before. Thus, the regulation legal of transnationalhedge fund exposes loopholes in supervision, specifically, the supervision ofoffshore hedge fund. As a consequence, the profit in investors and the order offinance market are disturbed. In the current financial market of China, owing to theincomplete short sales mechanism, there has been trade loss caused by the hedgefund managers of investors.In the first chapter, this article introduces the general situation of hedge fund.Based on the first chapter, the following chapter in the article analyses the legalissues of transnational hedge fund. Hence, in the third chapter, this article discussesthe legal supervision status and the further reform regard to the principles oftransnational hedge fund. Moreover, in the last chapter, this article puts forwardsuggestions for improving China transnational hedge fund supervision law.