Energy players expect further market fragmentation

Energy market fragmentation is likely to continue as larger players scale back their activities under Dodd-Frank

The energy sector is likely to see traders continue to leave larger operations to form smaller commodities-focused hedge funds, according to market players, as regulators continue to roll out the Dodd-Frank Wall Street Reform and Consumer Protection Act.

Sunil Dalal, chief risk officer at Lochridge Investment Advisors, a Houston-based energy-focused hedge fund, says: “I wouldn’t be surprised to see people break away from larger hedge funds to form smaller funds over the next year.”

He says this