Hedge funds and their implications for financial stability

Bericht

The paper provides an overview of the hedge fund industry, mainly from a financial stability and European angle. It is primarily based on an extensive analysis of information from the TASS database. On the positive side of the financial stability assessment, hedge funds have a role as providers of diversification and liquidity, and they contribute to the integration and completeness of financial markets. Possible negative effects occur through their impact on financial markets (e.g. via crowded trades) and financial institutions (e.g. via prime brokerage). Several initiatives have been launched to address these concerns and most of them follow indirect regulation via banks. If any direct regulation were to be considered, it would probably have to be implemented in a coordinated manner at the international level. At the EU level there is currently no common regulatory regime, although some Member States have adopted national legislation.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ECB Occasional Paper ; No. 34

Classification and Topics

• Classification: Wirtschaft ; International Financial Markets ; General Financial Markets: Government Policy and Regulation ; Banks; Depository Institutions; Micro Finance Institutions; Mortgages ; Pension Funds; Non-bank Financial Institutions; Financial Instruments; Institutional Investors ; Investment Banking; Venture Capital; Brokerage; Ratings and Ratings Agencies
• Subject: Asset management ; crowded trades ; financial regulation ; financial stability ; hedgefunds ; prime brokerage ; risk management. ; Finanzmarkt ; Geldpolitik ; Portfolio-Management ; Risikomanagement ; EU-Staaten ; Hedgefonds

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Garbaravicius, Tomas ; Dierick, Frank
• Event: Veröffentlichung
• (who): European Central Bank (ECB)
• (where): Frankfurt a. M.
• (when): 2005

Further information

• Handle: http://hdl.handle.net/10419/154487
• Last update: 10.03.2025, 11:42 AM CET