Abstract
Investment strategies, narrowly speaking, encompass and describe the behaviors and decisional assumptions of the entities investing on the market. An investment strategy is a set of rules and patterns of behavior, through which an investor intends to pursue his/her orders of buying and selling on a given market. Alternative investments are characterized by a very broad range of investment opportunities, while offering multiple risk and the return rate combinations, which generally are unavailable through application of traditional investment methods. Understanding the possibilities of shaping the risk profile and the return rate by the managers working under alternative strategies is one of key aspects of alternative investments.
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Notes
- 1.
A similar systematization of investment strategies, which takes into account the level of sensitivity to changes in the market trend was adapted by Jaeger (2002).
- 2.
This term was created by Ross (1976), who used this concept as the basis for the APT Theory (Arbitrage Pricing Theory).
- 3.
More on the method of pricing the forward/futures contracts can be found in Hull.
- 4.
A term used in the US in reference to treasury securities with a specified maturity, which are characterized by high level of liquidity.
- 5.
Analysis of effects associated with short-selling and their impact on informational efficiency of the market was analyzed by Diamond and Verrecchia (1987).
- 6.
The Tuna Index is created based on information made available by long/short funds at HedgeFund.net.
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Sokołowska, E. (2016). Investment Strategies of Hedge Funds. In: The Principles of Alternative Investments Management. Springer, Cham. https://doi.org/10.1007/978-3-319-13215-0_3
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DOI: https://doi.org/10.1007/978-3-319-13215-0_3
Publisher Name: Springer, Cham
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