Indeed, the very term ‘hedge fund’ seems to be used rather more loosely than it used to be: we are really talking about any investment vehicle which is willing and able to take advantage of the vast array of financial products, 24-hour trading and ample liquidity to expose the funds of sophisticated investors to virtually any conceivable type of risk.
The growth of such funds is an aspect of globalisation – that process in which the national barriers to trade in goods, services and capital are eroded and in which economic and financial activity is increasingly organised on a trans-national basis. But like many aspects of the modern globalisation phenomenon, hedge funds leave people with mixed feelings.