AllAboutAlpha.com – Several pundits have recently pronounced the so-called “hedge fund model” to be dead (or at least “upended“). But is the patient clinically dead, or is it just having an out-of-body experience? After the recent trauma experienced by the sector, hedge fund administrators will likely play a central role in bringing the industry back from the other side.
Hans Hufschmid, the CEO of GlobeOp, one of the world’s biggest hedge fund administrators, recently told the FT that:
“There will be tremendous trading opportunities. We are seeing opportunities that we haven’t seen in our lifetime, just in terms of relative trading let alone directional…
“Convertible bonds are extremely cheap, there are mortgages that are extremely cheap and distressed assets that are extremely cheap. There are lots of opportunities that are ideal for hedge funds to take advantage of.
“Further, hedge funds will face less competition with investment bank proprietary trading desks largely disappearing from the market.”