Renaissance Defends 'Basket Options' In Front Of US Senate

The US Senate Permanent Subcommittee on Investigations called Peter F. Brown, Co-Chief Executive Officer and Co-President of Jim Simons’ Renaissance Technologies LLC, among others, to testify on the use of basket options accusing the hedge fund of trying to evade taxes. But according to Brown, the basket options were a practical solution to a strategic problem and the tax implications were more of an afterthought. “Deutsche Bank proposed a basket option transaction to Renaissance in the late 1990s. It did not do so with a focus on tax benefits. The basket options that Deutsche Bank AG (NYSE:DB) (ETR:DBK) proposed allowed…