Category: Hedge Funds
A hedge fund is an investment fund that pools capital from institutional investors or accredited investors and invests in a variety of assets, often with risk-management techniques and complex portfolio construction.
They are administered by a professional investment management firm, and usually structured as a limited liability company, limited partnership, or other similar vehicle.
Hedge funds are different from mutual funds, as their use of leverage is not capped by requlators. They are also distinct from private equity funds, as most hedge funds invest in relatively liquid assets.
| |All hedge funds are not created equal as the return box chart shows for the post Financial Crisis period. There is a significant amount of dispersion across hedge fund styles. Over the period 2009-2018, the difference between the best and worst hedge fund category is almost 7 percent after we account for global equities and bonds. … Read more The dispersion in hedge fund returns – Differences in style matter
| |The attraction to private equity and other less liquid alternatives is clear from the Guide to Alternatives by JP Morgan Asset Management. The return profile is much higher for private equity and debt funds than more liquid alternatives and global bonds; however, the dispersion in returns is multiples higher than what can be expected from other public categories. … Read more The Desire For Private Equity – Return And Yield; But Time May Be Running Out
| |All alternative investments and hedge funds are not created the same. There is significant dispersion in their correlations with global bonds and equities. Some are better at diversification and others are good for adding returns. A recent Guide to Alternatives from JP Morgan Asset Management provides long-term correlations for alternatives and hedge funds for the post Financial Crisis period. … Read more Where are you getting diversification within alternatives?
| |WYSIWYG – “What You See Is What You Get”. This is a phase that has been applied in computing to describe the standard that what is on a computer screen should translate to what is on a printed page. … Read more WYSIWYG, Hedge Funds, and Alternative Risk Premia – The Business of Product Marketing
| |A key issue with any hedge fund investment is liquidity. How much should you be paid for illiquidity with assets? How much should you be paid for illiquidity with a fund structure? How much liquidity do you need? What are the liquidity terms that are acceptable for a fund? … Read more Liquid or Illiquid: Are you getting paid enough for less liquidity?