You only need to look at the LTCM and Bernie Madoff examples of the last couple of years to realise that due diligence is an important part of choosing a hedge fund.
Proper hedge fund due diligence hinges on being able to effectively gather and analyse information about the fund. A hedge fund may offer up information that is not requested, but an investor should assume that only requested information will be provided.
Therefore, a proper list of documents, questionnaires and interviews will ensure that an investor is properly informed about a fund before making an investment decision. Holborn Assets undertakes due diligence on behalf of our clients, helping to ensure that risks are reduced. It’s important to keep in mind that the information gathering process presumes a hedge fund manager’s honesty in providing complete and accurate information, and that intentional fraud will more likely be uncovered through a thorough due diligence process.
To find out more about the due diligence process, please contact us today.