Hedge Fund Glossary

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Big Boy Letter

a letter sometimes entered into in connection with a secondary trade of Securities where one party to the trade has more information about the Issuer than the other. A Big Boy Letter says something to the effect that one party may have more information than the other about the Issuer, but because they are both “big boys,” they are still knowingly and willingly entering into the transaction. Big Boy Letters raise a number of legal issues, including whether the letter itself is actually enforceable and whether or not the letters actually work as a defense against insider trading liability.

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