A hedge fund manager is required to disclose the past 5 years of performance, whether it is the result of a fund or the result of individual trading. <b>If</b> he did not disclose the performance of his last fund in his disclosure documents then he is in direction violation of a MAJOR CFTC regulation.
Schindler Trading
- Thread starter 99atlantic
- Start date
Could you point me in the direction of the specific cftc regulation regarding this, particularly the result of individual trading record for the last 5 years. Does that individual trading record have to be audited as well as disclosed? I find this interesting as I have never seen individual trading results disclosed in disclosure documents. Does this extend to contributions and reallocations in IRA's, 401ks etc as well as investements in cd's, interest bearing accounts, investments in physical assets if all of these are allowed by the fund? And are these disclosures required for excempt funds as well as many hedge funds are? Thank you.
When I was studying for the Series 3 one of the question said a CTA/CPO had to disclose personal trading history as well as pool history for a minimum of 5 years, if 5 years of trading history existed. Kaplan may have been wrong in that regard because the CFTC does not state anything about personal trading history, just the pools. I do believe a manager has to state performance for another fund but it doesn't state that in this article.
http://www.cftc.gov/opa/press96/opaadv10-96.htm
http://www.cftc.gov/opa/press96/opaadv10-96.htm
Just to clarify, a cta/cpo is not required to disclose personal (aka proprietary) trading results. They are, however, required to state if proprietary trading accounts will be open to inspection by their investors.
That doesnt proclude them from including the past performance of those accounts in their DD. They must explicitly state that the accounts are proprietary and non related to the trading program being offered (even if they trade it the same way).
startraitor
For all the rules, check out : http://www.nfa.futures.org/compliance/publications/dd2001/DD2005.pdf
The section "Required Performance Disclosures" will tell you all you need to know.
Also, regarding your question on exempt pools, you are not required to provide any disclosure documents at all, although you'll be hard pressed to get investors without them. But, the rules say a DD is not required for an exempt pool. Audited financials may be necessary though, if you except non-accredited investors. But again, thats an SEC rule, not an NFA. An exempt pool can basically start up, register as exempt, and start trading without disclosing anything.... Scary huh? Better know your cpo well.....
- jeff
That doesnt proclude them from including the past performance of those accounts in their DD. They must explicitly state that the accounts are proprietary and non related to the trading program being offered (even if they trade it the same way).
startraitor
For all the rules, check out : http://www.nfa.futures.org/compliance/publications/dd2001/DD2005.pdf
The section "Required Performance Disclosures" will tell you all you need to know.
Also, regarding your question on exempt pools, you are not required to provide any disclosure documents at all, although you'll be hard pressed to get investors without them. But, the rules say a DD is not required for an exempt pool. Audited financials may be necessary though, if you except non-accredited investors. But again, thats an SEC rule, not an NFA. An exempt pool can basically start up, register as exempt, and start trading without disclosing anything.... Scary huh? Better know your cpo well.....
- jeff
yeah, you are right
by the way, HEY
I have read Schindler's new prospectus and for all you HATERS, he does disclose his monthly performance in the previous fund.
u boyz need to grow up. schindler is not a rookie and he is regulated by the NFA. so chill.