Preqin, the alternative assets data and statistics firm, says that most hedge funds in the UK and Europe comply with the European Union's Alternative Investment Fund Managers Directive.

The organisation, whose original name was Private Equity Intelligence, notes that 90% of British firms and 82% of fund managers in the rest of Europe comply with the directive.

Despite the good compliance figure, not a single British hedge fund manager in its recent survey expected the AIFMD to help his firm in the coming year. By contrast, 55% of hedge funds elsewhere in the EU believe that it will.

The AIFMD has fewer detractors than it did six months ago, with 45% of respondents to last month's survey believing that the directive will change the hedge fund landscape for the worse, as opposed to 58% in December last year.

Only 15% of US hedge fund managers and a quarter of such firms in Asia and the rest of the world are complying. Two-thirds of firms globally reported that the costs of complying with the AIFMD were higher than expected. No fund managers reported the costs as lower than expected.

Size also matters. The largest fund managers are more likely to be compliant; 46% of fund managers with more than $1 billion in AuM comply, while 19% of those with less than $100 million do.

A large proportion (42%) of fund managers based outside the EU do not plan to raise capital from EU investors in the near future; of this group, 59% are avoiding the region due to concerns about the AIFMD. Many managers based outside the EU are relying on investors to approach them through so-called reverse solicitation, i.e. on their own initiative without the firm doing any marketing. Even so, 38% of US managers have chosen to avoid the EU completely, with most citing compliance costs and the risks arising from uncertainty and a lack of guidance to flesh the directive out. Forty per cent of all firms in the survey with less than $100 million in AuM will not be marketing a fund in the EU at all.