Hedge Fund Operational Due Diligence: Understanding the Risks (Wiley Finance)

How to diagnose and monitor key hedge fund operational risks. With the various scandals taking place with hedge funds, now more than ever, both financial and operational risks must be examined. Revealing how to effectively detect and evaluate often-overlooked operational risk factors in hedge funds, such as multi-jurisdictional regulatory coordination, organizational nesting, and vaporware, Hedge Fund Operational Due Diligence includes real-world examples drawn from the author's experiences dealing with the operational risks of a global platform of over 80 hedge funds, funds. of hedge funds, private equity, and real estate managers. Jason A. Scharfman (Jersey City, NJ) is a Director of Operational Risk with Graystone Research, a unit of Morgan Stanley. His responsibilities include analyzing and reporting on the operational risks of alternative investments considered for investment by ultra-high-net-worth individuals.

Customer Reviews:

Not Optimized for Kindle

By Graylight "art_ca" - March 20, 2012

The content in this book is quite basic, but helpful as an introductory overview. There are many simple terms that are explained in detail, yet more complicated terms are thrown around with no definition or background (examples being master feeder structure,, onshore and offshore funds etc). There are also several typos and factual mistakes (13Ds are filed when funds reach a 5% ownership threshold, not 10% as is stated in this book). The Kindle edition is not satisfactory - especially considering the high price point. Most of the tables are presented in a landscape format that cannot be read directly, since the orientation of the book on a Kindle or iPad automatically adjusts to portrait. Overall, a frustrating reading experience.

Interesting and instructive

By James L. Davis - February 20, 2009

Good solid book. The author began this book by essentially stating that this is a subject that has been ignored for way too long. After reading this very instructive work I couldn't agree more - operational due diligence is a very important part of hedge fund investing, and this book was a great guide. I liked this book for several reasons, the biggest one being that it does not merely describe just a checklist or outline a due diligence questionnaire for hedge funds due diligence. The operational due diligence techniques described seemed to be practical and actually something people could implement. I also liked the historical perspective gave me a good context for everything I was reading too. I enjoyed the examples too. A lot of interesting points and was thought provoking for me.

About time!

By M. Gutenplan - January 22, 2009

A colleague recommended this book and I was not at all disappointed - overall great, timely book.
This book provided a very good overview of the subject of hedge fund operational due diligence. Unlike most of the other hedge fund books I have read which drone on for hundreds of pages about nothing, this book was very clear and easy to follow. The author spells out in detail how to perform an operational due diligence review and points out some of the pitfalls to watch out for along the way.
I thought the chapter on combining the results of an operational review into the asset allocation process was quite interesting. I also like the last chapter on trends in the industry which I thought hit the nail on the head. This is a very interesting and layered topic and this book made me rethink about my approach to investing and due diligence in a good way. Wish I read something like this years ago.