Reuters Italia- Every year, hundreds of funds and fund managers have quietly left the industry, which now manages $1.75 trillion (880 billion pounds). But this year, their exits will be more numerous after a meltdown in subprime mortgage investments spread to other sectors and caught some of the most seasoned managers off guard, investors, analysts and fund managers said this week.
Two prominent Bear Stearns funds and Sowood Capital, run by a former Harvard Management stock picker, collapsed recently, while an ailing fund run by Goldman Sachs got a $3 billion cash injection this week.
Dozens of funds are said to be nursing heavy losses and investors and managers say they expect more suffering funds will pop up in the weeks ahead.
“This year is going to be the worst we’ve ever seen in terms of numbers of funds having problems, worse than 1998,” when hedge fund Long Term Capital Management collapsed and the private sector banks engineered a bailout, said John Mauldin, who invests in hedge funds at Millennium Wave Advisors.
