Hedge Funds in Germany
Hedge Funds in GermanyUpdated on Monday 12th September 2016
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The hedge fund market began to develop at a faster pace in Germany after 2010, so the market is relatively young. However, foreign investors seeking for a solid investment market can set their operations in Germany, which is one of the most important economies in the European Union (EU). In Germany, institutions carrying financial activities in the pension fund market are the most interested in the investment opportunities which can be provided by a hedge fund. Our team of lawyers in Germany can offer assistance on how to register a hedge fund here.
Hedge fund in Germany – definition
The hedge funds in Germany are vehicles which are available only for professional investors, such as various financial institutions or high net worth individuals. They are set up as alternative investment funds which can use pools of securities in order to generate high returns. Hedge funds can carry out at the same time several investment strategies, which means that they can be incorporated as an umbrella-fund, a structure which allows the establishment of several sub-funds.
They are allowed to carry their operations on both the domestic and the foreign markets; our attorneys in Germany can offer an in-depth presentation on the characteristics of German hedge funds.
Legislation referring to German hedge funds
Those who want to invest in Germany should become familiar with the legislation referring to German hedge funds, which are regulated by the German Capital Investment Code.
Following the regulations of the above mentioned legislation, the hedge funds in Germany can be set up either as open-ended funds or as closed-ended funds.
The open-ended structures can be further categorized in:
• contractual-type fund – it does not represent a legal personality and it is managed by an asset management company;
• investment stock corporation with variable capital.
The closed-ended funds can be registered as:
• investment stock corporation with fixed capital;
• closed-ended limited partnership.
Businessmen interested in receiving further details on the hedge funds in Germany can address to our German law firm for legal assistance or representation.