When Prime Brokers Fail: The Unheeded Risk to Hedge Funds, Banks, and the Financial Industry (Bloomberg)

An informative primer on the new landscape of leading prime brokers Before the recent financial crisis, both regulators and market participants disregarded the complex and dangerous nature of the relationship between prime brokers (the banks) and their clients (the funds). In When Prime Brokers Fail, J. S. Aikman examines the convoluted structure of this relationship, the main participants, and the impact of the near collapse of prime brokerages on the financial world. Filled with in-depth insights and expert advice, When Prime Brokers Fail takes a close look at the unheeded risks of prime finance and lays out the steps required for managers to protect their funds and bankers to protect their brokerages. Examines the challenges, trends, and risks within the prime brokerage space Discusses the structural adjustments firms will need to make to avoid similar disasters Analyzes the complex relationship between hedge funds and their brokerages and the risks that multiply in extraordinary markets Covers new ways to manage an inherently risky business and the regulations that may soon be introduced into this arena Engaging and informative, this timely book details the intricacies and interdependencies of prime brokerages and the role that these operations play in our increasingly dynamic financial system. Praise for When Prime Brokers Fail. "An essential guide to understanding why so many hedge funds failed during the 2008 crash and why so many will continue to fail in the future.". Franois Lhabitant, PhD Chief Investment Officer, Kedge Capital Professor of Finance, EDHEC Business School. "A must-read for every hedge fund manager, investment banking executive, and prime brokerage professional. This is hands down the most educational resource on the challenges, trends, and risks within the prime brokerage space.". Richard Wilson, founder of the Prime Brokerage Associat "When Prime Brokers Fail is a detailed look at the relationship between hedge funds and their brokerages and the risks that multiply in extraordinary markets. This relationship has been the source of unexpected risk for banks lending to highly leveraged hedge funds, as well as for the funds with assets at struggling banks"--Provided by publisher. Extraordinary markets Fundamentals of prime finance Strategy and opportunity Hedge funds Hedge fund managers and investment advisers Prime brokerages Prime brokerage business model Securities lending and financing Executing brokers Life cycles Risk management Legal and compliance issues What the future holds.