BoE issues warning to hedge funds

The Bank of England has warned hedge fund managers the eurozone crisis could result in a clampdown on their activities.

Bank of England regulator Robert Jenkins yesterday warned senior hedge fund managers to beware a potential clampdown on their trading activities if the eurozone crisis triggers a return to the kind of liquidity crunch that followed the Lehman collapse, reports the Independent. In a stark warning to traders who have become complacent again with the assumption that liquidity in financial markets could be taken for granted, Jenkins warned this may not be the case. "Short-term traders count on it; algo [algorithmic "black box"] trading depends on it. Long/short strategies presume you can ...