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Cybersecurity future focus for fund managers

| 10/12/2014 | 0 Comments

(CNS Business): Cloud computing and cybersecurity have become major concerns across the hedge fund industry for regulators as well as investors, according to EY’s 2014 global hedge fund and investor survey: Shifting strategies: winning investor assets in a competitive landscape.

Of all managers surveyed, 85% said that security concerns are the main impediment in using the cloud, and although 80% of managers expect to increase their spend on cybersecurity, few have made investments thus far. Fewer than one in three investors are confident in their managers’ cybersecurity policies.

The survey also found that regulatory reporting expenses can translate into an added drag on margins, reaching 6% on average, assuming a historical margin of 30%.

“Regulatory reporting expenses, which were negligible even a couple of years ago, have grown significantly and are now impeding managers’ bottom line,” stated Natalie Deak, Americas Co-Leader, Hedge Fund Markets, EY. “For smaller managers it represents nearly a 7% drag and is creating a clear barrier to entry for new and emerging funds.”

On Thursday 11 December, EY will also be hosting a Global Hedge Fund Symposium on Grand Cayman, where thought leaders from the firm and across industry will share insights and discuss many of the issues addressed in the survey.

“The hedge fund industry continues to play a vital role the strong growth we have seen across the asset management industry in Cayman,” said Jeffrey Short, Partner and Wealth and Asset Management Leader in EY’s Cayman practice. “Our annual global survey points to a number of key challenges and opportunities the industry is facing as we approach 2015 – including new product development, cybersecurity and the regulatory landscape. We are very excited about next week’s event in Cayman and look forward to discussing these issues, among others, with those taking part in the symposium.”

Download the full report here

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Category: Finance, Financial Crime, Financial Services

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