Prying Open Hedge Funds' Exit Door

Prominent investor Joseph Umbach is suing hedge fund Carrington Investment and its manager for putting a freeze on redemptions

Lately it has become quite common for hedge fund managers to slam shut the exit doors—tying up their investors' money for months on end while hoping for a quick end to the bruising credit crunch that's wreaking havoc with hedge fund performances. For investors it can be a frustrating state of affairs: A wealthy manager gets to keep their money and continue to earn a management fee for sitting on a huge pile of cash.

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