Customer Reviews

Hedge Fund Risk Fundamentals: Solving the Risk Management and Transparency Challenge

5 star:		(2)
4 star:		(0)
3 star:		(1)
2 star:		(0)
1 star:		(1)

 

 

Hedge funds are complex, risky investment vehicles. Other funds, such as most equity mutual funds, have straightforward investment strategies. By contrast, equity-oriented hedge funds may engage in various trading practices and investment strategies. They may be short funds, long-short funds or market neutral funds. And equity-oriented hedge funds are only a small sliver of the hedge fund universe. Thus, assessing the risk of hedge funds is a challenge. In language intelligible to most lay readers, author Richard Horwitz lays out the issues to consider when evaluating hedge fund risks. He has accomplished a great deal merely by writing this in readable prose, instead of in equations. He also explains his company's hedge fund risk measurement system. We believe every hedge fund manager and anyone who even thinks of investing in a hedge fund should read this book.

With the increasing universe of alternative investments, comes a more difficult and complicated task of selection for many sophisticated investors. From quantitative analysis to qualitative assessment, this book covers a full spectrum of topics. It offers an interesting perspective and methodology in breaking down risks associated with investing in these highly complex and opaque strategies. Where transparency has always been an issue, it's like a breath of fresh air to finally find a method that satisfies both the disclosure-hungry investor, and the secretive hedge fund. The platform offers a unique way of bucketing and aggregating risks into logical styles and factors, which ultimately strips away the need for full position-level transparency. The comprehensive and flexible system allows investors to take advantage of useful tools and measurements that will aid them in better assessing risks and managing their portfolios. Finally, a book written for the risk gurus of the hedge fund world.

Shows the reader how some hedge funds look and measure risk. A lot of finance lingo and very complicated material.. If you want a view of how some hedge fund guys look at their portfolio....I would pick this book up...However if you are wanting to pick up a book that's easily under-stable I would stay away. Overall a very interesting book for anyone serious about starting up a hedge fund...However be ready to spend a good time figuring out some formulas for those math deficient.

How can a risk manager in a hedge fund know so little about risk management? This book is the most simplistic -in the negative sense of the term- risk management book i have ever come accross. Unless you don't even know the most basic theories of risk management, do not waste you time reading this book. The most innovatice and only technical insight in this book is : 1 + 1 = 1.41, said differently: "don't put your eggs in the same basket". My grandma knew it already...and she died before hedge funds existed.
As for the transparency issue, no solutions are offered...just questions with no critical approach.