TITLE

An Alternative Look at Hedge Funds

AUTHOR(S)
Murguia, Alejandro; Umemoto, Dean T.
PUB. DATE
January 2004
SOURCE
Journal of Financial Planning;Jan2004, Vol. 17 Issue 1, p42
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
This article presents a critical overview of hedge funds for advisors considering them for clients' portfolios. In 2002, the number of advisors using hedge funds increased dramatically to 15.3 percent. If advisors are unaware of the operational and performance attributes of hedge funds before recommending them to clients, they may end up reading about their recommendations in the headlines of their local newspaper. Despite their popularity and phenomenal growth in assets, hedge funds have been around since the 1950s. While there is no broad consensus, the investment industry classifies hedge funds into a variety of investment strategies that are directional or nondirectional. Nondirectional strategies are structured to have low correlations with a specific market and to provide positive returns regardless of market conditions. Directional strategies attempt to benefit from broad market movements. Analyzing the accuracy of hedge fund indexes is a difficult task because a record of every single fund does not exist. A manager may have produced spectacular returns by engaging in risky trading strategies that do not require any specific manager skill. Two such strategies are short-term volatility and the Saint Petersburg concept. INSET: Executive Summary.
ACCESSION #
11917823

 

Related Articles

  • Lock-up Periods May Grow Longer For Hedge Funds. J.F. // Bank Loan Report;11/22/2004, Vol. 19 Issue 45, p1 

    Reports on the extension of lock-up periods for hedge funds in the U.S. Effects of traditional transactions on the return of investments; Similarity of hedge funds to private equity firms; Changes in debt and equity investing.

  • Behind the hedge fund numbers. van der Walt, Mark // Finance Week;Winter2004 Supplement, p14 

    The article focuses on the extent of hedge fund risk. Unlike unit trust funds, hedge funds report voluntarily to one or more industry databases that compile indices from those funds that choose to be included. As a result, hedge fund indices represent only a general proxy for the industry rather...

  • Hedge funds still risky business. Keavney, Robert // Money Management;7/22/2004, Vol. 18 Issue 26, p16 

    Discusses investments in hedge funds in Australia. Consistency of ability to produce good returns; Possibility of high return with low risk investment; Negative effect of fees, tax, transparency and gearing on hedge funds.

  • Demystifying Hedge Funds. Ubide, Angel // Finance & Development;Jun2006, Vol. 43 Issue 2, p41 

    The article discusses the ins and outs of hedge funds. While hedge funds may exude an aura of modernism and exoticism, their goals of capital preservation, limited value fluctuations and positive annual return are traditional. What distinguishes hedge funds from other investments is its use of...

  • BIGGER ISN'T ALWAYS BETTER. Smith, Matthew // BRW;12/6/2012, Vol. 34 Issue 47, p52 

    The article reports on the issues to put in mind when considering hedge funds in Australia. A study by research firm PerTrac finds that young funds outperformed the average tenured funds for 14 out of the 16 years since 1996. It was noted that hedge funds have been having problems replicating...

  • Does survivorship bias cut both ways? Collins, Daniel P.; McMahon, Chris // Futures: News, Analysis & Strategies for Futures, Options & Deri;Apr2006, Vol. 35 Issue 5, p18 

    The article discusses the findings of Roger Ibbotson and Peng Chen's research about the sources of hedge fund returns in the U.S. Ibbotson and Chen estimates that survivorship bias skewed hedge fund returns in the 10-year study higher by 2.74%.The study claimed that backfill bias accounted for...

  • HEDGING YOUR ENDOWMENT BETS. Logue, Ann C. // University Business;Nov2005, Vol. 8 Issue 11, p46 

    Discusses the factors that should be considered in investing school endowments in hedge funds. General rule of investment returns; Difference of a hedge fund from traditional investments; Guidelines for endowment managers on investing in hedge funds.

  • Singles champions. Maier, Tom // Money Marketing;7/8/2004, p47 

    The article discusses single-stranded hedge funds. Assessment of the return approach to investment of hedge fund managers; Generation of investment return; Analysis of the investment process.

  • WHERE'S THE RISK? De Silva, Harindra // Canadian Investment Review;Winter2003, Vol. 16 Issue 4, pR9 

    Deals with the importance for pension plans to understand the risks and rewards of adding hedge fund allocations. Factors contributing to the decision of plan sponsors to use hedge funds; Analysis of returns from hedge funds; Advantage of hedge funds over institutional investments.

Share

Read the Article

Courtesy of VIRGINIA BEACH PUBLIC LIBRARY AND SYSTEM

Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics