Cabinet Favors End to Hedge Fund Ban

German Chancellor Gerhard Schröder’s cabinet on Wednesday approved a ban on selling shares in hedge funds to private investors. If the measure becomes law, it will bring Germany in line with European Union standards on the investment vehicles, which can employ riskier methods than traditional equity or bond funds. Expected to take effect in 2004, Germany could soon develop a hedge fund market worth billions of euros. “This will strengthen the German investment branch’s international competitiveness,” Stefan Seip, managing director of the BVI investment association, told Bloomberg News.