Squaring the gearing circle
Just before the hedge fund industry got the GM/Ford jitters, four experts joined Hedge Funds Review in a roundtable to discuss the topic of leverage at the fund of hedge fund level. With gearing spicing up a portfolio, the conversation revolved around the pros and cons of borrowing to invest
Michael Romanek: Our industry, in general, is still maturing with the practice of leveraging fund of hedge funds (FoHF) only existing, as far as I know, since 1996. That said, FoHFs were not gearing in any meaningful numbers until around 1998-1999. In FoHF financing, there is nothing like the number of service providers as compared to other areas. There are five to seven main players - the same players on both sides of the Atlantic - and their practices are not homogenous by any means. In the US
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