A hedge fund is a pooled investment fund that holds liquid assets and that makes use of complex trading and risk management techniques to improve investment performance and insulate returns from market risk. Among these portfolio techniques are short selling and the use of leverage and derivative instruments. In the United States, financial regulations require that hedge funds be marketed only to institutional investors and high-net-worth individuals.
Harry Max Markowitz was an American economist who received the 1989 John von Neumann Theory Prize and the 1990 Nobel Memorial Prize in Economic Sciences.
In finance, a portfolio is a collection of investments.
Financial risk management is the practice of protecting economic value in a firm by managing exposure to financial risk - principally operational risk, credit risk and market risk, with more specific variants as listed aside. As for risk management more generally, financial risk management requires identifying the sources of risk, measuring these, and crafting plans to mitigate them. See Finance § Risk management for an overview.
John Clifton "Jack" Bogle was an American investor, business magnate, and philanthropist. He was the founder and chief executive of The Vanguard Group and is credited with popularizing the index fund. An avid investor and money manager himself, he preached investment over speculation, long-term patience over short-term action, and reducing broker fees as much as possible. An ideal investment vehicle for Bogle was a low-cost index fund representing the entire US market, held over a lifetime with dividends reinvested.
Investment management is the professional asset management of various securities, including shareholdings, bonds, and other assets, such as real estate, to meet specified investment goals for the benefit of investors. Investors may be institutions, such as insurance companies, pension funds, corporations, charities, educational establishments, or private investors, either directly via investment contracts/mandates or via collective investment schemes like mutual funds, exchange-traded funds, or Real estate investment trusts.
Financial modeling is the task of building an abstract representation of a real world financial situation. This is a mathematical model designed to represent the performance of a financial asset or portfolio of a business, project, or any other investment.
Security Analysis is a book written by Benjamin Graham and David Dodd. Both authors were professors at the Columbia Business School. The book laid the intellectual foundation for value investing. The first edition was published in 1934 at the start of the Great Depression. Graham and Dodd coined the term margin of safety in the book.
Frank J. Fabozzi is an American economist, educator, writer, and investor, currently Professor of Practice at The Johns Hopkins University Carey Business School and a Member of Edhec Risk Institute. He was previously a Professor of Finance at EDHEC Business School, Professor in the Practice of Finance and Becton Fellow in the Yale School of Management, and a Visiting Professor of Finance at the Sloan School of Management at the Massachusetts Institute of Technology. He has authored and edited many books, three of which were coauthored with Nobel laureates, Franco Modigliani and Harry Markowitz. He has been the editor of the Journal of Portfolio Management since 1986 and is on the board of directors of the BlackRock complex of closed-end funds.
James Patrick O'Shaughnessy is an American investor and venture capitalist, currently serving as the CEO of O'Shaughnessy Ventures. He is the founder of O'Shaughnessy Asset Management, LLC (OSAM), an asset management firm that Franklin Templeton later acquired.
Lawrence D. Hite is a hedge fund manager who, along with Ed Seykota, is one of the forefathers of system trading. He is the author of the book, The Rule: How I Beat the Odds in the Markets and in Life—and How You Can Too, which was named a Wall Street Journal, LA Times, and Porchlight Books bestseller.
Barton Michael Biggs was a money manager whose attention to emerging markets marked him as one of the world's first and foremost global investment strategists, a position he held—after inventing it in 1985—at Morgan Stanley, where he worked as a partner for over 30 years. Following his retirement in 2003, he founded Traxis Partners, a multibillion-dollar hedge fund, based in Greenwich, Connecticut. He is best known for accurately predicting the dot-com bubble in the late 1990s.
William J. Bernstein is an American financial theorist and neurologist. His research is in the field of modern portfolio theory and he has published books for individual investors who wish to manage their own equity portfolios. He lives in Portland, Oregon.
Stocks for the Long Run is a book on investing by Jeremy Siegel. Its first edition was released in 1994. Its fifth edition was released on January 7, 2014. According to Pablo Galarza of Money, "His 1994 book Stocks for the Long Run sealed the conventional wisdom that most of us should be in the stock market." James K. Glassman, a financial columnist for The Washington Post, called it one of the 10 best investment books of all time.
Performance attribution, or investment performance attribution is a set of techniques that performance analysts use to explain why a portfolio's performance differed from the benchmark. This difference between the portfolio return and the benchmark return is known as the active return. The active return is the component of a portfolio's performance that arises from the fact that the portfolio is actively managed.
A portfolio manager (PM) is a professional responsible for making investment decisions and carrying out investment activities on behalf of vested individuals or institutions. Clients invest their money into the PM's investment policy for future growth, such as a retirement fund, endowment fund, or education fund. PMs work with a team of analysts and researchers and are responsible for establishing an investment strategy, selecting appropriate investments, and allocating each investment properly towards an investment fund or asset management vehicle.
Farallon Capital Management, L.L.C. is an American multi-strategy hedge fund headquartered in San Francisco, California. Founded by Tom Steyer in 1986, the firm employs approximately 230 professionals in eight countries around the world.
Martin L. Leibowitz is a financial researcher, business leader, and a managing director of Morgan Stanley. His most well-known work is Inside the Yield Book.
In finance, active return refers the returns produced by an investment portfolio due to active management decisions made by the portfolio manager that cannot be explained by the portfolio's exposure to returns or to risks in the portfolio's investment benchmark; active return is usually the objective of active management and subject of performance attribution. In contrast, passive returns refers to returns produced by an investment portfolio due to its exposure to returns of its benchmark. Passive returns can be obtained deliberately through passive tracking of the portfolio benchmark or obtained inadvertently through an investment process unrelated to tracking the index.
Stephen Todd Walker is an American finance expert and author. He has an extensive background in alternative investments. He has written two books on the subject, Wave Theory For Alternative Investments: Riding The Wave with Hedge Funds, Commodities, and Venture Capital by McGraw-Hill in December 2010 and Understanding Alternative Investments: Creating Diversified Portfolios that Ride the Wave of Investment Success by Palgrave MacMillan in July 2014. Presently, he is a senior vice president at Royal Bank of Canada.
