Hedge fund: Difference between revisions
Jump to navigation
Jump to search
Amwelladmin (talk | contribs) No edit summary |
Amwelladmin (talk | contribs) No edit summary |
||
| Line 2: | Line 2: | ||
We define a [[hedge fund]] as a couple of guys with a bright idea and a rented office in Mayfair. | We define a [[hedge fund]] as a couple of guys with a bright idea and a rented office in Mayfair. | ||
The Oxford English Dictionary says it is an “offshore [[investment fund]], typically formed as a private limited partnership, that engages in speculation using credit or borrowed [[capital]].” | The Oxford English Dictionary says it is an “offshore [[investment fund]], typically formed as a private limited partnership, that engages in speculation using [[Margin lending transaction - SFTR Provision|credit]] or borrowed [[capital]].” | ||
That neglects to mention how much they charge, or that they talk a lot about [[alpha]] — even ''[[leveraged alpha]]'' — and have the [[Backtesting|back-tests]] to prove it — while doing a lot of [[vega]]. | That neglects to mention how much they charge, or that they talk a lot about [[alpha]] — even ''[[leveraged alpha]]'' — and have the [[Backtesting|back-tests]] to prove it — while doing a lot of [[vega]]. | ||
Revision as of 13:27, 10 April 2019
|
Prime Brokerage Anatomy™
|
We define a hedge fund as a couple of guys with a bright idea and a rented office in Mayfair.
The Oxford English Dictionary says it is an “offshore investment fund, typically formed as a private limited partnership, that engages in speculation using credit or borrowed capital.”
That neglects to mention how much they charge, or that they talk a lot about alpha — even leveraged alpha — and have the back-tests to prove it — while doing a lot of vega.
Vega, by the way, is not a drug.[1] In fairness, in speaking of credit and borrowed capital, it does nod in Vega’s direction.
Hedge funds hang out with
See also
References
- ↑ OR IS IT? For those pursuing yield return, the lure of leverage can be a little addictive, which may or may not be a plot point in Hunter Barkley’s forthcoming novel The ISDA Protocol.