4 ms·
Correct me if I am wrong, but isn't the "extreme circumstances" clause the same one used by Michael Burry prior to the 2008 crash (detailed in The Big Short)?
by the_watcher 10y ago
Correct me if I am wrong, but isn't the "extreme circumstances" clause the same one used by Michael Burry prior to the 2008 crash (detailed in The Big Short)?
I don't think it's only British funds with this kind of language. It seems like standard boilerplate a lawyer would insert into the documents as a catch-all for anything unexpected (and misuse of it would be addressed with litigation)
- cesarb 10y ago> I don't think it's only British funds with this kind of language. It seems like standard boilerplate a lawyer would insert into the documents as a catch-all for anything unexpected (and misuse of it would be addressed with litigation) Yes, this kind of clause can be found elsewhere. The ones I'm most familiar with are Brazilian funds, and randomly picking one from a major bank, the rest of the rule for it is: if the fund stays closed for more than 5 days, the manager has 15 days to do a vote among the holders, which can then replace the manager, reopen the fund, keep it closed, pay in assets instead of cash, split the fund, or even liquidate it. So any misuse of this clause would probably lead at least to the manager losing control over the fund.