There are four broad styles of hedge funds and multiple strategies beneath each style which are discussed at length in the book Hedge Funds Demystified by Scott Frush. This article summarises the four broad hedge fund styles and provides an insight into the management of hedge funds. In many cases, Hedge Fund managers combine strategies [...]

After watching a short excerpt of a Warren Buffet speech, I thought I may quickly summarise the collapse of the famous Hedge Fund, Long Term Capital Management. But First, Watch this excerpt, it is both funny and informative. I have sourced most of the information below from an excellent paper done by Gregory Connor and [...]

Buying stocks through margin lending Margin transactions involve buying securities with borrowed money. Brokerage firms can lend their customers money to purchase securities and keep the securities as collateral, allowing the customer ride the inherent risk of the stock without the requirement of purchasing 100% of the stock. The example below taken from a study [...]

Welcome to part two of my blog when and why to sell a stock short which gives a good fundamental analysis of short selling stock. Short selling strategies Short selling strategies are used in speculation, hedging, arbitrage and ‘against the box’ strategies. Many investors believe that a good combination of short and long positions on [...]

Many investors have heard of the concept of short selling and perhaps many of those people are familiar with the rules of short selling and the strategies behind doing it. It is intrinsically a very risky move as you are betting against the upward trend of the stock market in the hopes that a stock [...]