set Management were preparing to seize the assets in the process of recovering the monies advanced by them. The funds with heavy borrowing were supposed to have invested funds in highly rated debt products. These debt products in turn were exposed to a large extent to bonds backed by subprime mortgage debt. After a month the investors in the funds were advised that they would be getting nothing from one fund and only 9 cents for a dollar in another due to enormous losses made by the funds. As a bailout measure

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Bear had to grant $ 1.6 billion in emergency financing being one of the biggest attempted bailouts since the collapse of Long-Term Capital Management LP happened in the year 1998. (Financial Times 17th August 2007; Bloomberg 13th August 2007; BBC News 31st August 2007) In August it was Goldman Sachs Group Inc the New York-based hedge fund ranking second largest in the world had to introduce $ 2 billion as its own capital and an additional $ 1 million from outsiders to shore up its Global Equity Opportunities Fund since the assets value of the fund dropped by $ 1.4 billion to $ 3.6 billion during the previous week. The decline was due to the sudden decline in stock prices worldwide. (Bloomberg 13th August 2007) According to Hedge Fund Research the hedge fund industry as such generated the worst performance since the year 2000 with the average fund declining more than 3%. Quantitative funds took a severe blow. However

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