By Daniel Stanton
Dubai Financial Services Authority is first to regulate hedge funds.
The Dubai Financial Services Authority (DFSA) on Tuesday issued its hedge fund code of practice, the first of its kind to be issued by a regulator.
The code sets out standards of best practice for operators of hedge funds based in Dubai International Financial Centre (DIFC).
David Knott, CEO of the DFSA, said: "While there are a number of industry-based hedge fund codes, the DFSA's code is the first of its kind to be issued by a regulator."
The code covers areas of key operational, management and market-related risks, particularly in the areas such as valuation of assets, back office functions and exposure to market risks.
The issuance of the code follows several months of consultation with industry professionals and international regulators.
Lately, there have been increasingly frequent calls from the finance industry to regulate hedge funds, which are often highly leveraged and may not disclose the full details of their investments.