Bracebridge is a relative-value fixed-income fund that exploits small pricing differences in the credit market and hedges against those bets.

Zimmerman offered a typical scenario: Bracebridge buys a corporate bond it considers cheap while at the same time purchasing a credit-default swap on the bond in order to make money even if the company goes bankrupt. Leverage boosts returns.

The strategy hasn’t always come up roses. Long-Term Capital Management, a highly leveraged hedge fund run by John Meriwether, pursued a similar investment approach. In 1998, after Russia stiffed lenders including LTCM, the fund failed and was bailed out by its Wall Street competitors. The demise of LTCM hit other hedge funds, including Bracebridge, which held some of the same assets. Bracebridge lost about 26 percent, making it the worst year in its history.


Russian Economy


A few years prior, in 1992, Zimmerman’s husband, Harvard economist Andrei Shleifer, signed on to help privatize the Russian economy under the auspices of the university and the U.S. government. Zimmerman bought up beleaguered Russian debt, betting its value would rise, court filings show.

Complaints arose about Shleifer and his business partner allegedly using their position and influence for personal gain, according to court documents. Harvard, Shleifer and the U.S. Justice Department eventually reached an agreement in which the university paid $26.5 million to settle a civil lawsuit and Shleifer paid $2 million. Zimmerman’s company paid $1.5 million to resolve civil claims that it improperly used resources and staff from the government-funded project.

Neither Zimmerman nor her husband admitted wrongdoing in connection with their Russia dealings.

Zimmerman was born and raised just north of Chicago in Skokie, Illinois, the youngest of two girls. While attending Brown University in Providence, Rhode Island, she worked summers at O’Connor & Associates, a Chicago derivatives-trading firm. She stayed with them for three years after graduation, on the raucous floor of the Chicago Mercantile Exchange. Her first job was buying Japanese yen options, she said.

She stands a few inches over five feet with brown hair that she sometimes tucks behind her ears. Though her roots are in the Midwest, she’s a Bostonian now, relishing Red Sox games and working behind the scenes for a number of the city’s philanthropies.