Leveraged alpha: Difference between revisions
Jump to navigation
Jump to search
Amwelladmin (talk | contribs) Created page with "Snake Oil, basically. Leveraging alpha is technically possible, but in practice --- yeah. What most {{tag|hedge fund}} manager claim to be leveraged alpha is, usua..." |
Amwelladmin (talk | contribs) No edit summary |
||
| Line 10: | Line 10: | ||
Go hunting for charlatans [http://www.google.com/search?rls=ig&hl=en&q=%22Leveraged+Alpha here]. | Go hunting for charlatans [http://www.google.com/search?rls=ig&hl=en&q=%22Leveraged+Alpha%22 here]. | ||
Revision as of 18:48, 2 February 2016
Snake Oil, basically.
Leveraging alpha is technically possible, but in practice --- yeah.
What most hedge fund manager claim to be leveraged alpha is, usually, really plain old vega - that is, just leverage. If your market benchmark is beating the borrowing rate, you will make money by borrowing.
If someone pitches "leveraged alpha" product to you, they are most likely a charlatan - which you would expect, it being the financial markets and all - and a mediocre manager. Especially if they use backtesting to demonstrate their historical alpha.
Go hunting for charlatans here.