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Especially hard hit are those funds exposed to companies whose bonds are in default or are otherwise out of favor.
A squall that had appeared at two French investment funds exposed to US sub-prime loans was about to develop into a hurricane.
But a witness in Pennsylvania, not part of the government but using F.B.I. funds, exposed the plan after pretending to cooperate in raising National Lampoon's stock to $2.50 to $5 a share, from $1.87 in mid-March.
There had been early signs of the crisis – notably the first-ever profit warning from HSBC in February and the collapse of two Bear Stearns hedge funds exposed to high-risk mortgage debts in July.
Legg Mason posted on Tuesday a wider-than-expected quarterly loss — the U.S. money manager's first loss ever — as it took a big charge related to a bail-out of money market funds exposed to risky securities and suffered outflows from its poorly performing funds.
Wall Street was last night awaiting a statement from the investment house Bear Stearns on the losses suffered by investors in two of its hedge funds exposed to the sub-prime market to assess the risks to the rest of the financial sector.
Similar(53)
One does not need to diversify asset managers as one would stocks, but having one manager invest all of your funds exposes you to different kinds of risks, especially if you are not in a position to actively monitor, engage or audit the manager.
This summer no big storms materialised and the same sort of positions highly leveraged and insufficiently hedged, analysts say left the fund exposed to falling prices.
But that came after a fortnight when the prime minister had been embarrassed by having to admit that he had benefitted from an offshore investment fund exposed in the Panama papers, a Guardian investigation that exposed the extent of tax dodging by a British elite.
By taking on more dubious Greek risk — backed by new money from Europe and the International Monetary Fund — exposed banks would not just step back from the precipice of a "haircut," or a forced loss on their bonds, they might also hope that in another two years Greece will be in a better position to repay its debts in full.
They may wonder whether the debate about the fund exposes a Europe attempting to avoid making the guarantees a single currency needs.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com