Presentation by David Graubard, senior analyst, structured finance, Thomson Financial

As a result of recent underperformance in the equity and bond markets, the alternative investment sector has been booming, but a need for medium-term, stable financing still remains for hedge funds. Thus, savvy Wall Street bankers and rating agencies are courting hedge funds to dip into the term financing markets via securitization. The pitch is that the securitization panacea would allow dealers to help their hedge fund clients increase the growth of assets under management, give access to stable five-year area term financings, while the client earns lucrative annual management fees in the millions on each deal per annum.

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