Hedge Funds

Operational ratings, certifications gain momentum

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Firms that rate or certify the operational soundness of hedge fund firms are reporting an uptick in business as a growing number seek an external stamp of approval to appease cautious investors.

Moody's Investors Service this week issued its first public rating of a major hedge fund firm, Sorin Capital Management, a $300 million fixed-income relative value shop in New York. Moody's is also beefing up its hedge fund rating capabilities to handle more business.

Gary Witt, a managing director at Moody's, said he will hire a junior analyst and marketer to handle the expected inflow of hedge fund ratings applications