The Big Picture for Hedge Fund Returns
Hedge funds have generally underperformed over the past five years; however, we believe there are reasons to believe that equities and bonds will not be able to duplicate their strong performance going forward. A longer term perspective indicates that hedge funds have the ability to generate attractive returns on both a risk adjusted basis and as compared to stocks and bonds.
We live in eventful times – the case for event-driven investing
This blog highlights the current dispersion in the corporate sector, and the investment opportunities it is creating for event-driven managers. As such, the strategy can offer investors an attractive and relatively idiosyncratic source of return compared to more traditional equity and fixed income assets.
Risk Parity – Looking at Risk through a Different Lens
Risk parity is an investment approach that seeks to redress the imbalance between capital allocation and risk allocation across asset classes that traditional portfolios exhibit.
Sources of Hedge Fund Alpha
Most investors think alpha or performance comes from a single source: Manager Skill. However, there is more than one way to achieve superior returns and investors would be wise to consider all of the alpha options to maximize returns and minimize volatility within a portfolio.
We review the recent performance trends of “130/30” strategies, which involve a limited amount of shorting, but remain beta one (maintain equity exposure). While a surface look at recent performance in databases seems favorable, a deeper dive serves as a reminder that that there is no panacea in the search for alpha and that one is required to identify truly skilled managers in less efficient asset classes.
When the Glass is Half Empty – The Long and Short of Short Selling
This post examines the practice and use of short selling within an equity long-short portfolio and describes several of the more common short selling approaches.
The macroeconomic drivers of hedge fund strategy returns
Aon Hewitt researchers have embarked on a project to identify the key drivers of different hedge fund strategy returns. Using this information and overlaying our judgments about how the economic cycle will evolve helps inform our asset allocation recommendations with respect to hedge funds.
Une approche holistique des placements dans les actions
Cet article porte sur les avantages d’intégrer d’autres formes de placement dans la catégorie élargie des actions.
A Holistic Approach to Equity Investing
This piece discusses the benefits of integrating equity alternatives into the broader equity asset categories.
Managing Liquidity Risk from Alternative Assets
One of the biggest concerns about incorporating alternative investments in a portfolio is illiquidity, so investors interested in alternative assets must understand how much liquidity their portfolios need and how much can be provided by different types of investments. This piece seeks to help investors with this question.