For full text article go to : http://www.educorporatebridge.com/hedge-fund/hedge-fund-strategies/ This article on Hedge Fund Strategies, list down various strategies that are used by an Hedge fund Manager
• In this type of Hedge Fund Strategies, Investment
managers maintain long and short positions in equity and
equity derivative securities.
• It can range broadly in terms of exposure, leverage,
holding period, concentrations of market capitalizations
• Basically the fund goes long and short in two competing
companies in the same industry based on their relative
• By contrast, in market-neutral hedge funds target zero
net-market exposure which means that shorts and longs
have equal market value.
• In such a case the managers generate their entire return
from stock selection.
• This strategy has a lower risk than the above strategy
but at the same time the expected returns are also lower.
• In such a hedge fund strategy the stocks of two
merging companies are simultaneously bought and
sold to create a riskless profit.
• This particular hedge fund strategy looks at the risk
that the merger deal will not close on time, or at all.
• Because of this small uncertainty, the target
company's stock will sell at a discount to the price
that the combined entity will have when the merger
• This difference is the arbitrageur's profit.
• This hedge fund strategy aims to make profit
from large economic and political changes in
various countries by focusing in bets on interest
rates, sovereign bonds and currencies.
• Investment managers analyze the economic
variables and what impact they will have on the
markets. Based on that they develop investment
• This particular Hedge fund strategy makes profit
from arbitrage opportunities in interest rate
• Here opposing positions are assumed in the market
to take advantage of small price inconsistencies,
limiting interest rate risk.
• The most common type of fixed-income arbitrage is
Knowledge is like a line
With no ends…
So To know in detail about this
article click on the link
Be a part of edu CBA Family!!!
Visit our website
For Free Resources
Like us on Facebook
Follow us on Twitter
If you have found this Presentation
to be useful, kindly