Dow Jones – The relationship between a hedge fund and its prime broker is being squeezed on all sides. On one side, hedge funds have reduced leveraging activity, causing a squeeze on fees for their prime brokers, while at the same time still demanding more help to meet their investors’ extended needs.
On another, increasing regulation is piling pressure on both the funds and their brokers and, in the face of all this, brokers need to ensure that a symbiotic relationship continues to exist.
