Hedge Fund Flashcards
1
Q
What are hedge funds?
A
Investment funds that adopt non-traditional investment methods
2
Q
What are the 3 house styles of hedge funds?
A
Long/short - combining long and short investments
Relative Value - identifying price anomalies
Event Driven - using world events as triggers to trade
3
Q
What are the benefits of hedge funds?
A
Diversification (uncorrelated)
Usually Cayman islands/Bermuda so no red tape
Expertise
Variety
Volatility
4
Q
What are the drawbacks of hedge funds?
A
High cost
High entry level
Complexity
Volatility
