Archegos: A Spectacular Failure In Risk Management
Written by Dan diBartolomeo
A featured article of our July 2021 edition of PRMIA's Intelligent Risk quarterly newsletter
The recent failure of the Archegos hedge fund/family office was a spectacular example of the persistent deficiencies in hedge fund and broker risk management. The fund went from about a $30 Billion position to total collapse, leaving at least $7 Billion in publicly announced losses associated with failed margin calls across prime brokers at Credit Suisse, Nomura, UBS, and Morgan Stanley. A fifth prime broker, Goldman Sachs, has commented only that their losses are “immaterial.”
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