Law 798:  Hedge Funds and Complex Financial Instruments

This seminar is an examination of the law and regulations governing hedge funds and the financial instruments that many of these funds use to affect their trading strategies. Hedge funds are increasingly important actors in the global financial system, but the regulations governing them are poorly understood and constantly evolving. The seminar is designed to provide an overview of the types of activities these entities undertake, the types of regulatory reform efforts that have targeted these entities in recent years, especially in the wake of Dodd-Frank, and the policy issues that hedge funds will face in the years to come. Because it is difficult to understand hedge funds without understanding the types of trading activities they perform, this course will also give an overview of some of the complex financial transactions which allow many hedge funds to pursue their strategies. This will involve studying the economic and regulatory issues surrounding a variety of swaps and derivatives transactions. The course will also cover securitization, counterparty credit risk in OTC derivatives, the mutualization of risk among participants in clearinghouses and the rise of OTC clearing.

Sequence and Prerequisites: Business Associations I

Evaluation: Paper

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