Will the legal troubles at SAC Capital and the government’s huge crackdown on illegal insider trading that has already landed Raj Rajaratnam in prison for 11 years mark a seminal moment in the history of hedge funds? Will discretionary funds — those that use human brains to make investment decisions — be the losers of the crackdown? Will quantitative strategies — which rely on sophisticated computer models — be the big winners? Some supposed pundits seem to think so.
