Subject category:
Economics, Politics and Business Environment
Published by:
IBS Case Development Center
Length: 7 pages
Data source: Published sources
Topics:
Hedge funds; Financial services; Van US Hedge Fund Index; Standard and Poor's 500 stock index; Alfred Winslow Jones; Investment strategies of HF's; Lack of transparency; Securities and exchange commission; SAC Capital Advisors; Long Term Capital Management Fund; Investments with high returns; HF industry; Specialised investment strategies; HF investment portfolio; Lack of regulatory framework
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https://casecent.re/p/63261
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Abstract
With returns from investments in hedge funds (HF's) being much higher than returns from other investment products, investors were increasingly putting their money into HF's. Supporters of HF's were confident that the industry would continue to generate high returns and the investments in HF's were less risky. But critics of HF's argued that investments in HF's run a considerable risk because of the unregulated nature of the industry and the lack of transparency in the functioning of these funds. The case helps in understanding the evolution of the HF industry, and the investment strategies adopted by HF's. The case provides scope for discussion on whether the risk taken by investors in investing in HF's is worth its salt or not.
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Abstract
With returns from investments in hedge funds (HF's) being much higher than returns from other investment products, investors were increasingly putting their money into HF's. Supporters of HF's were confident that the industry would continue to generate high returns and the investments in HF's were less risky. But critics of HF's argued that investments in HF's run a considerable risk because of the unregulated nature of the industry and the lack of transparency in the functioning of these funds. The case helps in understanding the evolution of the HF industry, and the investment strategies adopted by HF's. The case provides scope for discussion on whether the risk taken by investors in investing in HF's is worth its salt or not.