More Money Than God

PUBLISHED : Sunday, 17 October, 2010, 12:00am
UPDATED : Sunday, 17 October, 2010, 12:00am

More Money Than God
by Sebastian Mallaby
Bloomsbury HK$210

Sebastian Mallaby shines a light on an industry (hedge funds) frequently regarded as being shrouded in secrecy. To paraphrase a remark by one observer, anyone would be secretive if they were making such multibillion-dollar bets. This is a highly readable account tracing the origins of hedge funds back to Alfred Winslow Jones half a century ago. Jones did not go to business school, had no PhD in quantitative finance, and did not work for a high-profile investment bank. In fact he flirted with Marxism and even worked as an undercover operative against the Nazis. But it was he who pioneered the combination of short selling and leverage, which was then copied by others. Mallaby writes about hedge fund managers with an air of awe. He says: 'The titans sometimes seem like mystic geniuses: they rack up glorious returns but cannot explain how they did it.' By mid-2007 hedge funds had a staggering US$2 trillion in assets. But by the end of this book, one cannot help but feel that certain hedge fund players have a tenuous grip on reality. A more fitting title might have been More Money Than Sense.



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