# kaal:claim:1428387-018

**Claim.** State de minimis investment adviser registration exemptions can be an attractive alternative to federal law for hedge fund managers, especially in a fund's start-up phase, because state registration would require an ADV filing and significant transaction costs the manager wants to avoid.

**Type.** mechanism  **Support.** argued

**Holds when.**

- start-up phase of a hedge fund
- where investors reside in states with de minimis exemptions

**Source quote.**

> Accordingly, certain state de minimis investment adviser registration exemptions for investors could be an attractive alternative to federal laws for hedge fund manager, especially in the start-up phase of a hedge fund.

**From.** Kaal, *Hedge Fund Valuation Retailization, Regulation, and Investor Suitability* (2009), IV.B.1 U.S. Blue Sky Law Exemptions for Investment Advisors, page 34

**Cite as.** Kaal, Hedge Fund Valuation Retailization, Regulation, and Investor Suitability (2009). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1428387

**Verify.** sha256 of source PDF `6aa3a280dc6750723be2389f3af2aabf3a16c4ce20e49fcdaddd7f2ea95a67aa` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202009%20-%20Hedge%20Fund%20Valuation%20Retailization%2C%20Regulation%2C%20and%20Investor%20Suitability.pdf

**Topics.** securities-law, economics

**Keywords.** blue-sky-laws, de-minimis-exemption, retailization, transaction-costs

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