Foreign Investment Restrictions on the Rise

Foreign Investment Limits, Shareholder Disclosures

Liquidity risk was amplified by the COVID-19 pandemic with regulators introducing a number of initiatives to mitigate the corresponding risk. However, it’s not the only area which has seen increased attention as a result of COVID-19. As summarised below, despite the G20 commitment to “support global trade and investment” during the pandemic, foreign investment restrictions have been on the rise.

Short Selling Bans – More Harm Than Good?

Shareholder Disclosures, Short Positions

With the recent market volatility caused by the COVID-19 pandemic, regulators across the EU and in some jurisdictions further afield have been banning short selling for varying periods. Although there are many who are sceptical of the benefits of short selling bans, several EU states including France, Italy, Spain and Austria had bans in place since March with Italy’s CONSOB opting for a ban until 18th June. Germany, along with Britain which still operates under EU rules, held back in imposing market wide bans.

Is your active fund really a Closet Tracker?

Shareholder DisclosuresLeave a comment

Closet trackers, also known as closet indexing or index hugging, refers to the practice of fund managers claiming to manage portfolios actively when in reality the fund stays close to a benchmark. The issues around ‘closet trackers’ form part of a broader issue on the effectiveness of investor disclosure and the legitimate expectations of investors in respect of the service provided by some asset managers.