Monday, 24 November 2014
Last updated 2 days ago
Feb 3 2010 | 7:49pm ET
In its continuing quest to understand the derivatives at the heart of the financial crisis, the Securities and Exchange Commission plans to pick the brain of the man who profited most from them.
The regulator has sent a request for information to Paulson & Co., the $30 billion New York-based hedge fund run by John Paulson, the Financial Times reports. Paulson made his name and fortune three years ago when he bet against the subprime mortgage market and won big, earning $15 billion for his investors.
According to the New York Post, Paulson is cooperating with the SEC. He is not the target of the probe, which instead is focused on the banks that created and marketed collateralized debt obligations.
Paulson earned triple-digit returns betting against the housing market in 2007, with his flagship Credit Opportunity Fund soaring nearly 600%. According to the FT, Paulson pushed banks to create synthetic CDOs for him to short, promising to buy the lowest-rated tranches of the CDOs. He also reportedly sought to specifically include mortgages from parts of the U.S. where he believed the mortgage market was particularly vulnerable.
In December, the SEC subpoenaed most of the top banks on Wall Street, including Bank of America Merrill Lynch, Citigroup, Goldman Sachs and Morgan Stanley, among others, seeking information about their sale and marketing of CDOs.
Nov 4 2014 | 9:45am ET
Data management is important to every business, but for hedge funds, it is critical. FINalternatives recently asked Peter Sanchez, CEO of Northern Trust Hedge Fund Services, how fund managers can deal with the demands of managing data while at the same time remain transparent and abide by operational best practices. Read more…
Reg NMS created a huge bifurcation in equity markets and while much of what has followed has been positive, in terms of lower fees and greater liquidity, many traders would like to see the market come...