Due to the usually large amount of assets that hedge funds manage, they are under intense pressure from investors to produce enviable returns. After all, the investor is paying hefty fees for the shrewdness and brilliance of the hedge fund manager. The investor is entrusting the manager with a substantial amount of capital … Continue Reading

The term “hedge fund” was originally coined due the fact that managers would try to hedge the funds against risk in the market by taking both long and short positions. However, risk is almost impossible to avoid in today’s volatile economy, though hedge fund managers do try to use various risk control tactics.
There are … Continue Reading

When trying to maximize absolute returns, the importance of assessing and mitigating risk shouldn’t be underestimated. Some memorable examples like LTCM and Tiger Fund not only show how heavy losses can be for some participants of the hedge fund industry, but also reinforce the perception that a good record of high absolute returns can mean … Continue Reading