Investments  

‘Little reason’ for lack of transparency in hedge funds

There is “very little reason” for hedge fund traders to be so opaque, according to the chair of one hedge fund investment company.

Speaking at a press event focused on listed credit, Charlotte Valeur, chair of Brevan Howard Credit Catalysts, said she has been trying for 10 years to increase transparency in the sector.

“For me, transparency is everything,” she said. “We are pretty transparent with everything. I see very little reason to not be transparent with people.”

Hedge funds are known for being more secretive than other fund types. Despite calling for greater transparency, Ms Valeur said there was a logic in traders’ mindsets prior to executing a trade.

“I see a reason when you are trying to build up a trade and you don’t want to share it with the world,” she said.

Hedge fund traders are more focused on the process rather than communicating their views to the outside world, Ms Valeur added.

“They don’t care about the people, they just want the trade,” she said. “They don’t want other people to know what they are looking at. If other people are looking at it, they won’t make as much return on the trade.”

Regardless of trading preferences, governance and how a company is run should always be transparent, she added.