Equity Market Neutral


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Equity Market Neutral

In hedge funds, an investment strategy that involves taking a long position in some equities and a short position on equities in the same industry. For example, a hedge fund may buy an oil company's stock while selling short the stock of another oil company. Theoretically, this reduces risk to the portfolio because stocks in a single industry tend to move in generally the same direction. Thus, a gain on one stock would offset a loss on another.
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However, the category fixed effects in model 5 do differ in some ways from those of models 2-4, with significant coefficients for emerging markets, equity market neutral, and multi-strategy, as well as for managed futures, suggesting significant differences between the full graveyard sample and the subsample of funds with status code 1.
After a strong year of performance, equity market neutral strategies are expected to be amongst the best performers in 2016, and are also the most in-demand.
It said equity market neutral strategies were expected to be among the best performers in 2016 following strong performance last year.
However, with hedge funds, they are bullish on equity market neutral strategies, which he says do well in markets with larger dispersion.
By launching PTR-Agora, an equity market neutral fund with a long/short investment approach, Pictet Asset Management (Pictet AM) has enlarged its Total Return fund range.
Global equity markets were broadly impacted by the increase in risk aversion, with weakest areas of performance in Fundamental Growth only partially offset by gains in Short Biased and Equity Market Neutral strategies.
Certain managers in Equity Market Neutral and Relative Value strategies believe that the increase in market volatility may continue and will likely favor securities pickers who perform fundamental analysis.
The new funds complement two existing American Century-managed funds, Equity Market Neutral and Market Neutral Value, which will be rebranded with the AC Alternatives name, the fund firm says.
The firm added that fundamental equity long/short, fundamental equity market neutral and event driven are the top three most sought after alternative '40 Act mutual fund strategies over the next 12months.
The three most-cited quantitative strategies by respondents were commodity trading advisor, quant equity market neutral and quant equity.
The Fixed Income Arbitrage and Equity Market Neutral sectors experienced the largest asset inflows on a percentage basis, with inflows in November equal to 2.