Read the small print

With prime brokers becoming an increasingly powerful force in the market, how closely should hedge fund managers examine the underlying agreements with their chosen provider?

To date, there are up to 20 banks which seek to provide prime brokerage services to European-based hedge fund clients. These institutions range from full service businesses seeking to cater for all strategies and sizes, in particular broad securities lending and swaps availability, to those which specialise in, for example, fixed income or synthetic products.

Since prime brokerage is regarded as a growth business, the good news for clients is that the competition in the market has put