Hedge fund investment management provider Tremont Advisers has established a joint venture with RiskMetrics to develop a Web-based risk reporting system for hedge fund managers and investors.
The two companies say the relationship will strive to deliver worthwhile risk exposure information while preserving the need of hedge fund managers to protect their proprietary trading strategies.
Barry Colvin, COO of Tremont Advisers says the effort should meet the risk management needs of the industry without requiring position-level transparency.
He says the initiative will focus on the creation of "best practices reporting standards" based on transparency of positions being made available on a secure basis solely to RiskMetrics.
"Current hedge fund risk reporting is inconsistent and non-transparent, making it difficult to assess risk in the aggregate at the fund of funds and firm level," adds Cynthia Nicoll, director of business development at Tremont. "Market participants have historically focused on position level transparency while the real issue is risk information and risk aggregation. We look forward to helping create standards that address these issues in our relationship with RiskMetrics Group."