Send This Page

Thank you for selecting hedge funds. Please read over the following important information regarding hedge funds before clicking through to the Hedge Funds intake form.

Here are the basic rules on HedgeLoans:

• Do not provide any investment advice whatsoever unless you are licensed to do so in the state in which the client/borrower candidate resides.
• Until our California Lender's License is in hand - will be within the next month or so, we believe - no California residents may nudertake HedgeLoans unless they have alternate, non-California residences-of-record.
• All stocks used in a HedgeLoan must be free-trading, registered, unrestricted, with no liens. An IPO would thus not qualify for a HedgeLoan.
• Though we can take a wide range of stocks in our program, some pink sheets, low-volume, pump-and-dump candidate, or low priced stocks (e.g. under $1.00) will not receive HedgeLoan offers.
• The ideal stock has a price over $5.00, volume steadily over 200,000/day, and the portfolio value is at least $500,000. There is no upward maximum but most deals over $30M are likely to be scams or broker chains.
• If you haven't spoken with the actual owner of the shares and verified that he is not just another intermediary, forget about closing the deal. It won't happen. The ratio for closings where an internediary does the talking for an actual shreowner is infinitesimal - less than on fiftieth of one percent. Conversely, the closing rati for cases where the agent has spojen with the actual shareowner (and the Agent is knowledgeable about our product) is between 20% and 50% depending on the program.
• The process is thus: You garner interest; you ask for a quote via email; you get your quote via email; if acceptable, you request a Term Sheet from us; you provide us with the client name (your Authorized Agent agreement will have already protected your client to you fully), number of shares, term/years preferred, and the points the client has agreed to (5 is default) and we will generate the full color term sheet with application. A conference call with our staff is usually nex - with yo in attendance - to go over the offer; if accepted, the client fills out application IN FULL neatly printed, signs, includes copy of his driver's license, and faxes to us. We then generate the Loan documents, which can be signed and faxed back to us.
• Shares then move via electronic DTC to our US top-tier brokerage account and are confirmed and hedged by one of several processes depending on the loan program (See our website for Flex, Star, Capped, and Flag programs); Cash loan funds are wired to client on a T+3 basis (three days after hitting account to ensure no hanky=panky with shares, claims, etc.). Quarterly account statements follow on the next quarter.
• Nearing maturity, the client will ask to receive his maturity notice and is asked how he'd like to exit the loan. He may ask us to sell his shares to pay of the loan; he may pay us in cash and repatriate his collateral shares that way; or he may walk away from repayment entirely (typically what is done when the share price does an Enron) - whereby he keeps his loan cash and owes us nothing in return, since it's a non-recourse-to-lender loan (don't worry, we haven't lost anything, having hedged the portfolio for that very purpose usually with investment-grade counterparties).

Do hedge funds sound like the right option for your business? If so, then please proceed to the Hedge Funds intake page to sign up!

             Send This Page