It's official. In a highly anticipated move, the Securities and Exchange Commission voted 3-2 in favor of requiring hedge fund managers to register as investment advisors with the agency last week.

The mandate, which will take effect on Feb. 1, 2006, will enable the Commission to collect more information on the rapidly growing investment product and give the SEC staff the ability to conduct examinations of the funds. The new requirement will force hedge funds with more than $25 million in assets to implement several new recordkeeping procedures, which opponents to the rule say will be costly and are unnecessary.

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.