Tag Archives: Market Neutral

Long/Short Mutual Funds

  The market downturn last year has led mutual funds to begin testing new strategies to produce gains with lower risk. Many managers are trying to replicate the methods used by long/short hedge fund managers. By finding negatively correlated positions, fund managers are able to offset losses with gains from other assets in the portfolio.   “130/30” Funds “130/30” funds […]

Market Neutral Mutual Funds

  With last year’s market-wide slump, mutual funds are trying to take a play out of the hedge fund playbook. One of the more common strategies employed by hedge-like funds is market neutrality. By taking off-setting positions in equities, fixed-income securities, options, etc., managers can eliminate market risk. Market neutrality conceptually works like this: If a fund manager believes that […]

Some Mutual Funds are Trying to Emulate Hedge Funds

Janet Paskin of the Wall Street Journal reports that mutual funds are trying to emulate hedge funds in an attempt to satisfy average investors needs in alternative fund classes. In the past, hedge funds have been the investment country clubs for wealthy investors. The average investor had no access to hedge funds because he/she was deemed too unsophisticated to research […]