Hedge fund voluntary disclosure

Gavin J. Cassar, Joseph J. Gerakos, Jeremiah Ross Green, John R.M. Hand, Matthew Neal

Research output: Contribution to journalArticle

1 Citation (Scopus)

Abstract

Using a dataset of 3,234 letters sent by 434 hedge funds to their investors during 1995-2011, we study what motivates hedge fund managers to make voluntary disclosures. Contrary to the hedge fund industry's reputation for opacity, we observe that managers provide their investors with an array of quantitative and qualitative information about fund returns, risk exposures, holdings, benchmarks, performance attribution, and future prospects. We find that the tensions between the agency costs faced by investors and the proprietary costs faced by managers affect fund disclosures. Consistent with managers reducing proprietary costs, better-performing funds disclose less quantitative data about performance and holdings, and consistent with the presence of agency costs, riskier funds disclose less quantitative information about performance and assets under management.

Original languageEnglish (US)
Pages (from-to)117-135
Number of pages19
JournalAccounting Review
Volume93
Issue number2
DOIs
StatePublished - Mar 1 2018

Fingerprint

Voluntary disclosure
Hedge funds
Managers
Investors
Proprietary costs
Agency costs
Risk exposure
Fund managers
Assets
Performance attribution
Benchmark
Opacity
Industry
Disclosure

All Science Journal Classification (ASJC) codes

  • Accounting
  • Finance
  • Economics and Econometrics

Cite this

Cassar, G. J., Gerakos, J. J., Green, J. R., Hand, J. R. M., & Neal, M. (2018). Hedge fund voluntary disclosure. Accounting Review, 93(2), 117-135. https://doi.org/10.2308/accr-51841
Cassar, Gavin J. ; Gerakos, Joseph J. ; Green, Jeremiah Ross ; Hand, John R.M. ; Neal, Matthew. / Hedge fund voluntary disclosure. In: Accounting Review. 2018 ; Vol. 93, No. 2. pp. 117-135.
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Cassar, GJ, Gerakos, JJ, Green, JR, Hand, JRM & Neal, M 2018, 'Hedge fund voluntary disclosure', Accounting Review, vol. 93, no. 2, pp. 117-135. https://doi.org/10.2308/accr-51841

Hedge fund voluntary disclosure. / Cassar, Gavin J.; Gerakos, Joseph J.; Green, Jeremiah Ross; Hand, John R.M.; Neal, Matthew.

In: Accounting Review, Vol. 93, No. 2, 01.03.2018, p. 117-135.

Research output: Contribution to journalArticle

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Cassar GJ, Gerakos JJ, Green JR, Hand JRM, Neal M. Hedge fund voluntary disclosure. Accounting Review. 2018 Mar 1;93(2):117-135. https://doi.org/10.2308/accr-51841