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    • Thread Starter

    prime brokerage
    hold secutires of hedge funds and make loans to hedege funds while holding these secutires as collaterol (i think).

    but prime borkers also conduct in hypothcating (i no i have spelt it wrong) which means the debtors keep their security (which acts as colloteral) and on top of that get a loan from the prime broker .

    so which is it 1st or 2nd or both

    plus if hedge funds do hyothecting then where do they get the money to loan (it dosnt make sence since i know prime borkers do hold hedge funds secutires)

    also prime borkers make loans to increase levearge of hedge funds, the i pressume this loan can be of any asset class (or is it cash)

    thanks if any1 knows
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