— The hedge fund industry was pioneered by Alfred Winslow Jones in 1949. He worked for nearly 16 years in almost total secrecy until 1966, when Fortune magazine chanced upon his operation and highlighted his success. The article prompted a flood of immitators, and by 1968 there were about 200 funds

— George Soros’s Quantum Fund made hedge fund history for its role in forcing the pound out of the European exchange-rate mechanism in 1992. The Hungarian-born Mr Soros admitted that he had made at least $1 billion from his $10 billion bet on the pound’s collapse.

— There are more than 2,500 funds worldwide estimated to be worth $1.1 trillion. The Cayman Islands is the most popular location, with almost one in two registered there.

— When Long Term Capital Management, a fund run by two Nobel prizewinners, imploded in 1998 after Russia defaulted on its payments to international investors, the event almost wrecked the world’s financial system. A group of banks had to bail out the fund and its shareholders.

— Tiger Fund Management, advised by Baroness Thatcher, was wound up in 2000 after a disastrous slump. It had been the second-biggest global hedge fund group.

— The world’s biggest hedge fund manager is Man Group

— In 2005 hedge fund trading activity accounted for up to half the daily turnover on the New York Stock Exchange and the London Stock Exchange.

— Hedge funds across the board suffered their biggest monthly declines in eight years during August amid the global financial turmoil. According to Hedge Fund Research, which tracks the $2.4 trillion industry, the funds lost a collective 1.3 per cent of their value.

— Assets managed by hedge funds have grown at an annual compound rate of 25 per cent since 1990. They are predicted to grow at about 20 per cent a year over the next four years to $3 trillion.

— The fee structures of hedge funds vary, but the annual management fee is typically 20 per cent of the profits of the fund plus 2 per cent of assets under management.

Source: Times archive/Reuters

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