Practical analysis for investment professionals

Alternative Investments


Investing in Small-Cap Biotech through Hedge Funds

After analyzing small-cap biotech data from 2007 on, Akash Goyal has found that higher hedge fund ownership is positively correlated with forward returns and that stocks with higher short interest are correlated with negative forward returns.

Three Lessons from the Bernie Madoff Scandal

Norb Vonnegut culls three lessons from HBO's recent Bernie Madoff biopic. Taken together, they serve as a renewed prompt for investors to consider low-cost index funds. After all, these funds are hardly exclusive. The world is vetting them constantly. So long as investors reinvest dividends and other cash flows back into the funds, the annualized returns are a real measure of investment performance: What you see is what you get. And what’s better than that?

Book Review: How to Make Money with Global Macro

Global macro is as much an exercise in navigating the political economy as it is an alternative investment strategy. Practitioners must recognize its limitations and remember that change is the one constant.

Carbon Free? Really?

In the final analysis, can we truly measure the emissions of our portfolio? Or understand what the actual “carbon footprint” is? No, not really, says Christopher K. Merker, CFA, but it is becoming easier.

In Practice Summary: Social Responsibility (SR) Screens and Fund Performance

Does environmental, social, and governance (ESG) investing add or subtract value from investment portfolios? According to the findings of a trio of researchers, summarized in the new In Practice series, the answer is neither: Investors can both match index performance while also “doing good” for the environment and society.

The Stampede into ESG

The recent stampede of asset managers into environmental, social, and governance (ESG) investing is reminiscent of another time and another industry, says Christopher K. Merker, PhD, CFA.

A Rebalancing Market Means Higher Oil Prices

Jennifer Stevenson sees strong support for oil prices, and a supply-side rebalancing could mean big gains for North American oil companies.

The Golden Age of Hedge Funds

How many of the hedge funds out there are actually worth investing in? Ben Carlson, CFA, explores the question.

Soros, Fallibility, Reflexivity, and the Importance of Adapting

Eternal market truths are hard to find and difficult for us fallible humans to understand, says Tadas Viskanta. He recommends getting reacquainted with George Soros's theory of reflexivity.

Book Review: Hedge Fund Investing

This introduction to hedge funds is also an instructive work of financial history. It discusses hedge funds in relation to other assets and describes specific hedge fund strategies in detail. It also delves into the nitty-gritty of hedge fund operations. Practical rather than theoretical, the book contains worked examples. And a companion website provides practice questions and guideline answers.



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