All About Hedge Funds
By Robert Jaeger
All About Hedge Funds is a handy guide for investors and the intelligent layer-readers looking to enrich their hedge funds acumen by going beyond what the newspapers have to feed their brains. Written by Robert Jaeger, vice chairman and chief investment officer of leading hedge fund firm Evaluation Associates Capital Markets, the book is must for investors, financial experts and investment novices as it sheds light on various aspects of hedge fund investments including risk/reward tradeoffs and methods to use techniques for short selling.
The book is primarily divided in five parts and moves from basic introduction to hedge fund investment to techniques and tool kits required for smart investing and it concludes with a note on how to deal with the peripheral issues of hedge funds investing. This book can prove helpful for large investors in maintaining a balance in their portfolios as it tries to ease people from the hubris, which the author describes as an excessive pride or self-confidence.
Smartly divided in five parts, the book aptly binds up all the aspect of investing in hedge fund while detailing topics such as event-driven investing, relative-value investing, tax issues, equity hedge funds and global asset allocators, futures and options, leverage, short selling, and the list goes on.
In the part one, the book introduces the readers with the historical and institutional context of hedge funding introduces hedge fund managers and clients. This part feeds the mind of the readers with interesting background of hedge funding. The part two, ‘hedge funds, active management, and efficient markets’, flabbergasts the readers’ mind by making it aware of the uncertainty involved in the hedge fund investing. It basically talks about challenges involved in the hedge fund investment, the efficient markets, emotions and skills needed to get more return from the investment, how to make an efficiently diversified portfolios. In the end this module talks about the tyranny of the cap-weighted indexes.
The third part of the book contains information on leverage, short selling, and hedging. Part four talks about operational or peripheral issues such as legal and regulatory issues, performance fees and tax issues. The part five, ‘the menu of hedge fund strategies’, sheds light on equity hedge funds and global asset allocators, relative-value investing and event-driven investing.
As the author has claimed the book is not an ‘invest-and-tell’ nor it is a guide to be rich. It tells how to use a hedge fund community as a lens to view the larger system. All About Hedge Funds runs around the theme ‘Brain power is no guarantee of success’ and debunks the myths associated with hedge funds while incorporating safeguards to limit their volatility and risk. To conclude, the easy to read book makes investors aware of hedge funds – what they are and what they are not; techniques and tool to incorporate hedge funds into an existing portfolio; and types of risk involved in the hedge fund investing. In short it is a must to buy for all.
Review by Geetika Sachdeva