As noted last week by WSJ reporter Andrew Ackerman, the hedge fund industry regulator aka CFTC has further eased restrictions on hedge fund advertising, a move that could spark an uptick in creative branding strategies within an industry long constrained by rules that could further promote their offerings.
The below opening lines of Ackerman’s story should be a call to action for HF managers who understand the need to better position their story within mediums that are known to resonate with your targeted audience. After all, the most successful and most respected firms in other parts of the financial industry have enjoyed outsized ROI by investing in cohesive and creative ad campaigns, as measured by a combination of garnered AUM and increased good will value.
“..Washington–U.S. commodity regulators took long-awaited steps to make it easier for hedge funds and other firms to raise cash by publicly advertising stakes in their funds.
The Commodity Futures Trading Commission late Tuesday eased long-standing marketing restrictions on so-called private offerings by hedge funds and other funds sold only to wealthy investors, a move aimed at aligning the CFTC’s restrictions with similar rules set by the Securities and Exchange Commission…
The bulk of the hedge-fund industry declined to take advantage of last year’s eased SEC rules, in part because many funds were still barred from public advertisements under separate CFTC rules that apply to funds that engage in derivatives trading, as many firms do. The CFTC’s move to ease those restrictions Tuesday and make them similar to the SEC’s comes after more than a year of lobbying by the hedge-fund industry.”
Jay Berkman, the principal of corporate marketing and brand strategy firm The JLC Group, whose clients include a number of financial industry firms, including global macro strategy firm Rareview Macro LLC, noted, “If I were managing a hedge fund, this would be the time I’d be tapping into firms that are creative, but also truly understand the industry landscape and the profile of the targeted audience. ” Added Berkman, “An expert that understands that it’s not about what you are selling, but about what your customers want to buy.”