(www.scotsman.com) – ONE of Britain’s leading fund managers has hit out at the potential borrowings “bubble” within the hedge-fund industry that could burst in an echo of the split-caps debacle.
Douglas Ferrans, the Scots-born chief executive of HBOS’s fund management arm, Insight Investment, said he had a number of concerns about hedge funds, including their “lack of transparency and how highly-leveraged [borrowed] they are”.
Ferrans, in charge of £85 billion of funds at Insight, said a lot of hedge funds had borrowed at low interest rates, and could be very good investments. But he added: “If the excessive leveraging continues and interest rates rise again there could be a shakeout.”
