{"id":6026,"date":"2007-05-08T00:00:00","date_gmt":"2007-05-08T00:00:00","guid":{"rendered":""},"modified":"-0001-11-30T00:00:00","modified_gmt":"-0001-11-30T04:00:00","slug":"funds-bet-markets-will-remain-calm","status":"publish","type":"post","link":"https:\/\/hedgeco.net\/news\/05\/2007\/funds-bet-markets-will-remain-calm.html","title":{"rendered":"Funds bet markets will remain calm"},"content":{"rendered":"<p>  Financial News Online US- <span class=\"intro\">\u00c3\u00a2\u00e2\u201a\u00ac\u00c5\u201cSpeak softly but carry a big stick,\u00c3\u00a2\u00e2\u201a\u00ac\u00c2\u009d was the West African proverb adopted by former US president <a class=\"keywordsearch\" href=  \"http:\/\/www.financialnews-us.com\/?page=ushome&amp;keywordsearch=Theodore+Roosevelt\">Theodore Roosevelt<\/a>. It could be the motto of the hedge fund industry. While most keep a low profile they have  made a big impact on capital markets.<\/span><\/p>\n<p>  <span class=\"storytext\">There is evidence their trading strategies have dampened volatility and increased price correlation between assets, so prices move up and down together. If and when this  situation reverses, many funds may be in for a shock.<\/span><\/p>\n<p>  <span class=\"storytext\">Given their influence on markets, the stick being wielded by hedge funds is small. Ignoring leverage, hedge funds account for 1% of global financial assets, and up to 4% if  borrowing is included. Yet they account for more than 50% of daily turnover in London and New York-listed equities and 60% of credit derivative volumes.<\/span><\/p>\n<p>  <span class=\"storytext\"><span class=\"storytext\">And it seems funds are increasingly taking similar bets. The correlation between strategies has risen from 30% to 40% in mid-2003 to 80% to 90%,  according to the <a class=\"keywordsearch\" href=\"http:\/\/www.financialnews-us.com\/?page=ushome&amp;keywordsearch=European+Central+Bank\">European Central Bank<\/a>. With managers finding it more  difficult to make money, they are herding around opportunities.<\/span>&nbsp;<\/span><\/p>\n<p><strong><a href=\"http:\/\/news.google.com\/news\/url?sa=T&amp;ct=us\/6-0&amp;fd=R&amp;url=http:\/\/www.financialnews-us.com\/%3Fpage%3Dushome%26contentid%3D2447723300&amp;cid=1116108216&amp;ei=FQxARpypFJq40QHM3e23Dw\">ReadComplete Article<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Financial News Online US- \u00c3\u00a2\u00e2\u201a\u00ac\u00c5\u201cSpeak softly but carry a big stick,\u00c3\u00a2\u00e2\u201a\u00ac\u00c2\u009d was the West African proverb adopted by former US president Theodore Roosevelt. It could be the motto of the hedge fund industry. While most keep a low profile they [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-6026","post","type-post","status-publish","format-standard","hentry","category-syndicated"],"_links":{"self":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/6026","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/comments?post=6026"}],"version-history":[{"count":0,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/6026\/revisions"}],"wp:attachment":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/media?parent=6026"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/categories?post=6026"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/tags?post=6026"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}