Introduction to Hedge Funds

Course Overview

This interactive one day programme will offer an insight into probably one of the markets’ most widely misunderstood group of money Managers. 

More specifically the programme will analyse the Funds’ characteristics, the changing Investor profile, the vast range of trading strategies pursued & finally & probably most importantly, what Risk Management tools are employed. 

Course Content 

Hedge Funds – What are they?

• Hedge Funds defined. Lock-ups, Gates, Hurdle Rates
• The pursuit of Absolute Return & Performance Fees.
• How big is the Hedge Fund Universe? Smaller than it was
• External Relationships – Prime Brokerage, Custodians, Fund Administrators
• Tactics – Leverage & Short Selling. Regulatory intervention 

Case Study – How do Investors choose their Hedge Fund Manager? 

Why Hedge Funds? The Big Issues for Investors

• Rationale for Hedge Funds in an Investors’ Portfolio. Is it still there?
• The non-correlated Asset Class, Survivorship Bias, Drawdown
• HNWIs leaving the ship, Institutions more cautious
• Liquidity mismatch
• Benchmarking problems for Hedge Fund investors 

Case Study – What really puts off Investors?

Hedge Fund Investment Styles – Directional

• Overview of Style variations – Directional vs non-Directional
• Equity Long/Short
• Distressed Debt
• Managed Futures
• Global Macro 

Case Study – Which Commodities would have made you the most money?

Hedge Fund Investment Styles – Non-Directional

• Equity Market Neutral
• Event Driven/Risk Arbitrage
• Fixed Income/Credit Arbitrage
• Convertible Bond Arbitrage  

Case Study – Hedge Fund Style Index Performance data 

Risk Management for Hedge Funds

• Market, leverage and Credit risk
• Political and Legal risk
• Gap and liquidity risk, Mark-to-market risk, Style Drift risk
• Why do Hedge Funds fail? Do not forget Operational Risk
• Due Diligence
• Tools for the Analysis of Financial Risk – From VaR to Stress Testing

Delivering this course in-house for you to a number of participants could be very cost effective. Please call us on 020 7387 4484 to discuss this further.

If you have any questions about this seminar please write to us at post@redcliffetraining.co.uk.