London Stock Exchange- August’s stock market turmoil was the result of de-leverage and re-leverage activity in the quantitative hedge fund sector, it has been suggested.
Research conducted by Lehman Brothers Alternative Investment Management (LBAIM) concluded that too many quantitative hedge funds attempting to de-leverage and re-lever at the same time caused the turbulence, the Financial Times reports.
The report predicted that this pattern could be repeated if the same levels of leverage and assets under management as during this time are reached again.
