Looking forward, if hedge funds fail to retain their investors and cases of hedge fund closure become more frequent, the possibility of further sizeable position unwinds by the sector may pose a challenge to financial markets. In a context of global de-leveraging and mounting risk aversion, foreign investors also markedly reduced their exposures to emerging market financial assets.
Issues arising amongst some insurers in relation to matters such as capital management and the quality of risk management and governance sometimes revealed scope for improvements in the form of more specific definitions or guidance. 8  More specific provisions and definitions and clearer guidance on some matters would reduce scope for outcomes to be quite so dependent on firm’s interpretation of sufficient selfdiscipline.