An investment strategy that seeks to buy a relatively undervalued security and simultaneously short sell a relatively overvalued security with similar characteristics (same industry / sector, market capitalization, etc).
Two securities or obligations having equal rights to payment. A Latin term meaning "without partiality".
An investment strategy that replicates the performance of a specified index or benchmark and does not attempt to beat the market. Also commonly referred to as “passive investing”.
Percentage of positive months
The percentage of months that delivered positive returns since the inception of an investment.
The profits and losses of an investment over a specific period.
Hedge fund managers in particular typically levy a 20% performance or incentive fee, whereby the fund manager retains 20% of all profits above a high-water mark.
A legal document that describes a mutual fund's objectives, manager background, risks, terms, financial statements and investment parameters.
Funds from many individual investors that are aggregated for the purposes of investment, as in the case of a mutual or pension fund. Investors in pooled fund investments benefit from economies of scale, which allow for lower trading costs per dollar of investment, diversification and professional money management.
Legal restrictions placed on a fund's investment mandate and codified in the offering documents.
The amount of a security either owned (long position) or borrowed (short position) by an individual or by a dealer.
Provides services such as securities lending, leveraged trade executions, and cash management, among other things, to fund management firms.
Private Equity Investing
Equity securities of companies that are not listed on a public exchange. Transfer of private equity ownership is strictly regulated; therefore any investor seeking to sell his/her stake in the private company has to find a buyer in the absence of a market place. Returns on private equity are generally realized in three ways: a merger or sale, an initial public offering or a recapitalization.
Private securities trading methodology developed by an investment management firm.
An option contract giving the owner the right, but not the obligation, to sell a specific amount of an underlying security at an agreed upon price during a certain period of time or on specific date.