Subject: File No. S7-25-06
From: Andy Cho
Affiliation: IT Manager

January 27, 2007

There is no real reason to believe that smaller investors cannot understand hedge fund strategies, if properly explained. If investors can be assumed to understand the risks involved with individual US stocks, foreign stocks, commodity futures, currencies, options, mutual funds, and real estate, not to mention a host of Reg D limited partnerships, then how can anyone suggest that hedge fund strategies are beyond the understanding of investors? While management competence is the real issue investors should focus on, how difficult is it to understand the concept behind buying undervalued assets in a distressed debt fund?

A hedge fund is a business, generally with a straightforward premise. It is no more, and often far less, difficult to understand than the business risks and plans of typical US-based company (to say nothing of a bio-tech or high-tech firm or international company) than the risks and concepts of a typical hedge fund.

Most hedge funds have an offshore version with lower minimums. The reality is that international investors have more and better investment choices than do average US citizens.

If you ask the brokers and investment advisors whether they wish they had access to hedge funds on behalf of their clients during the difficult stock markets of 2000-2002, the answer would be a resounding yes. If you ask investors whether they should be able to make their own decisions - to have the same choices as the rich - the answer would also be yes.

The only people who benefit from limiting investor choice are those who have a vested interest in not facing the competition from hedge funds. As they seek to protect their turf, they have lost sight of the interests of those they should be serving.

Those who oppose allowing average investors to have the same choices as the rich should tell us why lower-net-worth investors are less intelligent or are deserving of fewer options than the rich. They should show why average investors should only be allowed funds which are one-way bets on an uncertain future.

I believe that investors would tell you that not allowing them the same choices as the rich is the type of government protection they do not need.

Its time to change a system where 95% (and soon to be 99%+) of Americans are relegated to second-class status based solely on their income and wealth and not on their abilities. Its analogous to discriminating against investors because of their gender or race or sexual preference. It is a matter of choice; its wrong to deny a person equal opportunity and access, based upon old rules designed for a different time and different purpose. I hope that someday Congress will see to it that small investors are invited to sit at the table as equals with the rich.