More hedge funds are now subject to SEC regulations. However, regulate them too severely, and they will no longer be considered hedge funds in the true sense. Not by the definition of what an investment hedge fund tries to do.
Their managers need secrecy in order to trade. If they divulge their intentions in advance, as stricter regulations promote, their efforts and objectives will be neutralized. Other investors will be able to counter strategy, to make any proposed hedging worthless or even dangerous.
Moreover, hedge fund activity had little to do with the financial downturn of 2008. Over-regulation is another instance of the administration’s jousting at windmills for no real purpose, other than catering to its anti-business, constituency.
Moreover, “family” funds have managed to escape government tentacles with obvious political ability.(See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)
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