HEDGE FUND STRATEGIES

Long-Short Equity

A Long-Short Equity strategy involves taking long positions in stocks (buying “long”) which are expected to increase in value, and short positions in stocks (by borrowing stocks to sell them) which are expected to decrease in value (at which point the fund manager buys them back at a lower price than the amount paid, and returns them to the lender).
 

Global Macro

Global Macro managers seek to derive profits from changes in global economies that are brought about by changes in government policies that impact interest rates, unemployment and inflation, which then affect the currency, bond and stock markets.


 

Event Driven

This strategy focuses on capturing the value gap created when companies undergo transformative corporate events that have yet to be priced by markets but that are expected to have a significant impact on shareholder value. Investments can be made across the capital structure of a company (i.e. equities, corporate bonds, convertible bonds, etc.).

Relative Value
Fixed Income

We introduce the concept of arbitrage: managers simultaneously take long positions on securities which are underpriced and short positions on securities that are overpriced to make an incremental profit. A fund manager will apply this technique after having identified differences in the prices of various fixed income securities (e.g bonds that are quoted in multiple markets).