Expectations dashed

Germany’s hedge fund market was expected to burst into life after regulations were loosened to allow domestic investors to place cash in domestic and offshore funds last year. But far from an explosion of activity, the first 12 months have been more of a damp squib. By Hann Ho

It’s been more than 12 months since the German authorities introduced legislation to allow domestic investors to tap the hedge fund market. But rather than the big bang many were predicting, Germany’s hedge fund market has started off with more of a whimper. Investors have been wary about putting their cash into hedge funds, a reluctance not helped by a widely reported €600 million fraud at one German fund earlier this year. Hedge fund managers, meanwhile, complain about overly stringent