Hedging on CDO Investments
This piece from This American Life is highly educational, describing how one fund came through the crisis ahead, by hedging its investments in CDOs.
This fund engaged in legal activities that successfully protected and grew its investors’ money. If this fund had failed, like so many other hedge funds did, it would not have been bailed out. Unfortunately, the media, feeding on a public eager for scapegoats, lumps it together with investment bankers who walked away with millions in bonuses at the expense of their investors as well as taxpayers.