An aggressively regulated portfolio of investments that uses leading investment strategies such as leveraged, long, short and derivative positions in domestic and international markets with the goal of generating high returns. Hedge funds are often set up as a private investment partnership with a limited number of investors and require a very large initial minimum investment. Investments in hedge funds are illiquid, in case that they require investors keep their money in the fund for a minimum of one year.
The Cayman Islands have a leading position in jurisdictions for fund formation with an estimated 80% of the world’s hedge funds domiciled there. At the end of the second quarter of 2015, there were 11,061 funds registered with the local regulatory authority (The Cayman Islands Monetary Authority (“CIMA”).
Cayman is a British Overseas Territory and as such maintains all of the security and stability in under the British flag. The UK remains responsible for the islands’ external affairs, defence and their legal system.