April 5th will mark the three year anniversary of the JOBS Act, and with it the lifting of the ban on general solicitation by hedge funds. Here are a few takeaways on the impact of this legislation:
Hedge funds are still only sticking their toes into the water. Apparently, most managers remain unconvinced of the value of spending money on general solicitation.
That being said, a few leading alternative managers have chosen to broaden their marketing efforts either through advertising, social media, or expansion of website content beyond simple boilerplate material. Ray Dalio of Bridgewater Associates, for instance, has developed his own YouTube channel, a detailed and genuinely informative website, and a wide range of educational videos on various economic topics.
Perhaps such moves are driven by the popularity of liquid alternatives among a large and growing mass affluent audience. Larger hedge fund managers may be positioning themselves to become liquid alt sub-advisers or to sponsor a line of liquid alt funds themselves. If such is the case, increased transparency and brand recognition will be key to creating a demand pull for their product among advisers and end users.