SEC Lifts Ban on Hedge Fund Advertising

WASHINGTON (AP) -- For the first time, hedge funds will be allowed to advertise to the general public under a rule adopted Wednesday by federal regulators.

The Securities and Exchange Commission voted 4-1 to lift a decades-old ban on hedge funds marketing their investments to a wide audience.

Hedge funds are still allowed to sell securities only to an exclusive group of investors: those with a net worth of at least $1 million excluding their primary residence, or annual income of more than $200,000 in each of the two most recent years. About 7.8 percent of U.S. households would qualify.

The change was mandated by legislation enacted last year. The law also makes it easier for small start-up companies to raise capital without having to comply immediately with SEC reporting rules.

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  • Report this Comment On July 10, 2013, at 4:42 PM, MikeBison wrote:

    Well the opportunities that will come from the SEC ruling on general solicitation will be interesting to follow. At Bison (www.bison.co), we believe the important changes from these new rules will have less to do with accredited investors and more to do with increasing data openness in the industry. Check out our latest blog post for details on how it will play out...http://wp.me/p3kTlL-10

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