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Gillian Tett: Snowball trades on a slippery slope

By Gillian Tett

Published: March 8 2007 17:56 | Last updated: March 8 2007 17:56

It is a truth almost universally acknowledged that a hedge fund in possession of a vast pile of finance will eventually start pursuing risky strategies when markets look too boring for too long.

Thus it should be no surprise that the era of ultra-low volatility that existed until last week has produced endless rumours about hedge funds using high-octane gambits to create returns. But could this gamble with risk have seeped into some corners of the corporate world as well?

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