Brave new world:the doorway to a new hedge universe

A period of financial crisis has compelled the hedge industry to evolve and get tough. But how are these challenges to be met?

A period of crisis can also be a period of transformation. A time of challenge can force changes onto an industry, making it stronger, more robust and more efficient. The hedge funds industry is now facing just such a time. The crisis in credit confidence is obviously affecting those investment groups that have relied on high levels of leverage and risk exposure to provide superior returns. It is also impacting prime brokers, the providers of this leverage, and they in turn are tightening their margin and collateral requirements, and reducing gearing levels. Many of the headline-grabbin...