Hedge Gates

My current understanding of the typical hedge fund is that there are certain dates when you are permitted to request a redemption. The hedge fund must then give you your money back within six to eight weeks. Some hedge funds have gates, which are limits on the amount of money you are permitted to withdraw.

September 30 was a hedge fund redemption request date. It seems likely that a lot of investors asked for at least some of their money back. That means that the hedge funds need to unroll their positions in order to get the money to give them.

I suspect that has something to do with the market collapse we are seeing. I don’t know how strong the effect is; nobody does, since hedge funds have essentially no reporting requirements.