Jul. 2, 2020

Opportunities and Obstacles Presented by the Current Economic Climate

The coronavirus pandemic has put the global economy into a tailspin. As countries and cities imposed strict restrictions on the movements of their citizens, economic activity slowed considerably, causing worldwide economic retraction, including recessions in the U.S. and abroad. How long the current economic climate will last – and whether it will worsen – are open questions. As a result, some fund managers are fielding complaints from investors and considering whether it is time to close up their shops. The news, however, is not all bad. Although the current climate has presented obstacles for certain fund managers, such as high volumes of redemption requests, it has also presented investment opportunities for others. In fact, some hedge funds are actively fundraising, and various fund managers are looking to hire distressed debt experts to take advantage of the opportunities in the market. In that spirit, the Hedge Fund Law Report is highlighting five articles from its historical archives exploring topics related to those opportunities and obstacles, including navigating issues related to distressed debt investments; preparing for a potential economic downturn; handling investor complaints; assessing considerations for going private; and winding down a fund. Next week (the week starting July 6, 2020), the Hedge Fund Law Report will resume its normal weekly publication.