By Pete Gallo
For those who consider hedge funds as archetypal bad guys,
secretive groups with trading desks manned by Darth Vader with
the Grinch as chief financial officer overseeing the
investments of retired James Bond villains, think again. Last
month, one such fund saved the day - and itself, of course - by
rapidly providing liquidity to an ailing sector of the
In late March, San Francisco-based Farallon Capital moved
quickly to defend one of its major portfolio holdings,
Accredited Home Lenders Holding.
The subprime mortgage lender was at the epicenter of
the recent credit quake that shook markets in March. And
Farallon was one of its largest shareholders, sitting on close
to two million shares in the first quarter, about 7.8% of
Accredited's outstanding common stock, according to filings
with the U.S. Securities and Exchange Commission.
Mind you, that...