Risk control

Capital protected hedge fund products have been all the rage in Europe since equity's bull run ended in 2001. Investors found further losses intolerable and principal protection provided safe harbour.

Bruce Terry, president of $1.2bn fund of funds Weston Capital, says with leverage charged at levels as low as Libor plus 50bp, investors were 'shooting themselves in the foot' by not taking leverage.

But now an increasing number of European and Middle Eastern investors are gearing up exposures. S