Derivatives Markets Swallow Own Tail?

Lewis, Janet
November 2005
Investment Dealers' Digest;11/7/2005, Vol. 71 Issue 42, p8
Trade Publication
The article points out that the derivatives markets are becoming so pervasive that they can now be compared to the snake that swallowed its own tail and the latest demonstration of this are derivatives being linked to hedge funds themselves. Banks dealing in these products should exercise due diligence on the underlying hedge funds and funds of funds, partly because, to hedge themselves, they usually have to buy into the underlying funds.


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