Derivatives on hedge funds: based on a hedge fund, a fund of funds, or a customized, actively managed basket of hedge funds.
The beauty of derivatives is that you can structure one on practically any underlying having an associated risk profile. As the IDD article: Derivatives Markets Swallow Own Tail? says "These days, the derivatives markets are becoming so pervasive that they bring to mind the ancient Greek symbol Uroboros, the snake that swallowed its own tail"
1 comment:
Thats true... yesterday i was thinking of structuring an over the counter derivative using airline ticket prices as underlyings... sadly enough they dont have enough homogeneity to be the subject of a structured wrapper, but I am willing to write infinite at the money call options at the prices air deccan is quoting today, they quote a frigging 4600 for a del bom...
anyone wants to go long on the same?
but yeah they really are swallowing their own tails...
long time buddy
kapil
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