[leroy_masochist]

Any time you're buying something in order to sell it at a later time, you're trading; even if your ownership is for a few seconds.

> I'm sure it's largely regulation that prevents these hedge funds from going straight to the market themselves and bypassing these "traders".

No, it's the fact that hedge funds are not in the business of making markets. Sales teams create value because they maintain relationships with lots and lots of portfolio managers; if someone calls them up and says, "I want to buy A shares of M stock at or below X price" or "I want to sell B shares of N stock at or above Y price", they know who to call; if they're good at their job, they'll have good instincts as to who may be interested.

Additionally, if a hedge fund just went out and announced that it wanted to buy or sell a bunch of shares in a given stock at a given price, it would move the market in a direction that would be bad for a hedge fund. For this reason, most big funds not only go through third-party prime brokers, but spread their orders across multiple broker-dealers in order to minimize visibility on their trades before the fact.