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Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/27400
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| Title: | Mandatory Disclosure and Operational Risk: Evidence from Hedge Fund Registration |
| Authors: | Brown, Stephen
Goetzmann, William
Liang, Bing
Schwarz, Christopher |
| Keywords: | Hedge funds
operational risk
SEC filing
Form ADV |
| Issue Date: | 2007 |
| Series/Report no.: | FIN-07-031 |
| Abstract: | Mandatory disclosure is a regulatory tool intended to allow market
participants to assess operational risk. We examine the value of
disclosure through the controversial SEC requirement, since overturned,
which required major hedge funds to register as investment advisors and
file Form ADV disclosures. Leverage and ownership structures suggest
that lenders and equity investors were already aware of operational
risk. However, operational risk does not mediate flow-performance
relationships. Investors either lack this information or regard it as
immaterial. These findings suggest that regulators should account for
the endogenous production of information and the marginal benefit of
disclosure to different investment clienteles. |
| URI: | http://hdl.handle.net/2451/27400 |
| Appears in Collections: | Finance Working Papers
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