1, increase the transparency of hedge funds. In the past, hedge funds hardly needed registration and information, but after the long-term capital management fund incident, the G-22 has set up a joint working group to study how to improve the transparency of hedge funds. Recently, the Group of Seven proposed a series of measures to reform the international financial system, including carefully studying the transparency and standards of investment banks, hedge funds and other institutions involved in international capital flows. For example, establish professional and prudent supervision procedures for the financial sector, formulate international standards to increase transparency and release information, inspect a large number of financial activities engaged in lending speculation and evaluate their impact.

2. Strengthen the supervision of hedge fund financing to reduce the leverage ratio of hedge funds and prevent banks, brokers and dealers from providing too many risky loans to hedge funds. Developing countries should require speculators to pay a deposit in local currency, so that speculators can bear certain foreign exchange risks and dare not suppress their local currency at will.

3. Limit the sources of funds for hedge funds. For example, the Japanese government is preparing to introduce a policy to prohibit domestic investors from investing in offshore hedge funds operating in tax havens. Offshore hedge funds account for about 45% of the total number of hedge funds, and the proportion of assets under management is as high as 70%.