The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookiesbefore using this site. Please see our Subscription Terms and Conditions.

All material subject to strictly enforced copyright laws. © 2022 Euromoney, a part of the Euromoney Institutional Investor PLC.

The good old days for hedge funds: Goodbye to all that

Are banks biting the hand that feeds them? Perhaps, but what choice do they have?

As prime brokers pull the plug on big and small clients, is there any way back to the good old days for hedge funds?

It was fun for a while – watching investment banks bow to hedge funds, offering them ever more generous terms in order to win their business and clambering over each other to try to please the new financial institutions that looked set to take over the world and steal investment banking business as well as investment banking talent.

But the power struggle of the past few years has ended abruptly, and the banks have emerged as the winners.

An increase in margin requirements for the smaller hedge funds, whose business prime brokerages could survive without, was only to be expected. But to seize the assets of valued and important firms such as Carlyle Capital was unthinkable one year ago.

Are banks biting the hand that feeds them, destroying the high-velocity traders that have boosted their spread and commission earnings? Perhaps, but what choice do they have? The hedge fund boom, as it will undoubtedly come to be called, looks as if it is over.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.


Unlimited access to and

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually


Unlimited access to and, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors


Already a user?