In particular, administrators and investment managers should pay particular attention to whether the secondary letter is unfairly advantageous to the investor concerned or whether it is detrimental to existing investors. By entering into side letter arrangements, hedge funds risk violating the principle that all investors should be treated equally. And of course, hedge fund administrators and add-ons may overlook their fiduciary duty to investors. Not much, apparently. Not yet, at least. An ASL spokesman recently commented in a newspaper article that the FSA does not consider the investment conditions set by hedge funds, given that hedge funds themselves are usually established outside their jurisdiction in the UK. A discount is the portion of interest or dividends earned by the owner (lender) of a share paid by a short seller (borrower) of the stock. .