Fund run by JPMorgan bet against Whale

Hedge funders were not the only market whiz-kids betting against JPMorgan's disastrous London Whale trading positions. Another part of his own bank was too.

It emerged yesterday that JPMorgan Asset Management, run by Mary Callahan Erdoes, was one of the investors betting big against the London trader Bruno Iksil, exacerbating his $2bn (£1.2bn) losses.

Ms Erdoes' Strategic Income Fund was one of the investors which profited handsomely from JPMorgan's chief investment office's losing bets, which were essentially insurance against clusters of big US companies defaulting on their debts.

Bloomberg reported that the fund had about $380m of insurance identical to that being sold by Mr Iksil. It is unclear how much profit Ms Erdoes' team made on the trades. Most of it will go to investors in the fund, rather than the bank, but it will do no harm to the bonuses of the fund managers involved.