Much of modern finance and risk management is built on the concept of efficient markets and the “bell curve” or symmetrical normal distribution. However, out in the real world things are a bit different. Over the years many have treated the so called “black swan” events as something that is an anomaly. [...]

This strategy involves investing in the securities of a company that is or is expected to be in trouble. Some distressed securities can trade at large discounts to their actual risk adjusted basis. This is due to the psychological effect that occurs in the marketplace when a firm gets into trouble or files [...]

It’s basically the “old style” hedge fund strategy, and many modern day hedge funds follow the equity long short or “equity hedge” strategy. But don’t let the name fool you… even though this strategy plays both long and short sides it should not

Global macro hedge funds are responsible for producing some of the more well known billionaire hedge fund managers, such as George Soros. It is also my favorite strategy, as the ideas behind it can be easily applied by individual investors. The strategy is very broad and makes use of virtually any security in [...]