George Soros: the man behind the hedge

EXAMINATION of documents related to the financial empire of George Soros, the speculator who made dollars 1bn helping to force sterling out of the ERM, has revealed for the first time the extent to which his personal interests are mixed up with those of outside investors, write Stephanie Cooke and Charles Raw. And it is becoming clear that Mr Soros is encountering difficulties arising from the size of the funds under management, now estimated at more than dollars 10bn ( pounds 6bn).

As central banks begin to inquire more closely into his operation, Mr Soros has reduced the size of his flagship Quantum fund by almost a quarter, in line with his declared policy of keeping the fund to a manageable size. But the reduction has done nothing to limit the extent of his overall empire.

Investors in Quantum, and three other funds already spun off to keep Quantum's size under control, are expected to plough about dollars 1.2bn into a new fund, Quantum Industrial Holdings. The new fund's investment policies reflect Mr Soros's deepening problems in finding new places to put the vast sums under his control.

Quantum is distributing dollars 4,600 per share, reducing the size of the fund by dollars 900m. The net asset value dropped by about 25 per cent.

Inside the money machine, pages 2-3

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