Alternatives

Question 1

What 3 strategies are under equity strategies?

Answer 1

Long/Short equity;
Dedicated short selling and short biased;
Equity market neutral

Question 2

What is equity market neutral strategy earn? How is its return compares to the other two?

Answer 2

earn alpha, beta=0

return is modest among the 3

Question 3

Does equity market neutral strategy use leverage? low or high?

Answer 3

Highest leverage amount the three.

Question 4

What strategies are under event-driven strategies?

Answer 4

Merger strategies and Distressed securities

Question 5

What does merger arbitrage strategies long and short?

Answer 5

Merger arbitrage long target stock and short acquirer stock

Question 6

Does merger arbitrage use leverage? low or high?

Answer 6

High

Question 7

What are 2 strategies under relative value strategies?

Answer 7

Fixed income strategies and convertible bond arbitrage

Question 8

What does convertible bond arbitrage strategies long and short?

Answer 8

Convertible bond arbitrage strategies long convertible bond and short stock

Question 9

Does convertible bond arbitrage strategies use leverage? low or high

Answer 9

High

Question 10

What standard deviation is required for convertible bond arbitrage strategies?

Answer 10

Stable, moderate

Question 11

What are the strategies under opportunistic strategies?

Answer 11

Global macro & managed futures

Question 12

What are the strategies under specialist strategies?

Answer 12

Volatility trading & reinsurance / life settlements

Question 13

What are the 3 hopes of hedge fund when they have a life settlement?

Answer 13

1. ongoing premium is low
2. cash surrender value is low
3. insured person die as early as possible

Question 14

What are the strategies under multi-manager strategies?

Answer 14

Fund of fund and multi-strategy hedge fund

Question 15

What are 3 common good characteristics of multi-strategy hedge fund?

Answer 15

1. improved fee structures (lower netting fee risk)
2. faster tactical asset allocation
3. more transparency

Question 16

What are 2 bad characteristics of multi-strategy hedge fund?

Answer 16

1. higher manager-specific operational risk

2. less liquidity or limitation trying to redeem back

Question 17

which strategy use lower leverage? Fund of fund or multi-strategy hedge fund? Which one is more diverse?

Answer 17

Fund of fund uses lower leverage and more diverse