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Yes but what hedge funds would do (are undoubtedly doing) is raise a huge amount of money on margin and use it to arbitrage the spread between these and related
by pmarca 13y ago
Yes but what hedge funds would do (are undoubtedly doing) is raise a huge amount of money on margin and use it to arbitrage the spread between these and related instruments with other durations. Of course this can go horribly wrong; read the book "When Genius Failed".
- ballard 13y agoOh god, LTCM. Beware of investors that have no demonstrable controls against automated/HFT pouring of more of my money into a black hole trying to "win" back their losses. The Trillion Dollar Bet is also a good, high-level documentary.