Fundamentals of Hedge Funds Training Course

Attend this three-day course and equip yourself with:

• The skills to demistify the increasing complexity of the strategies adopted
• Understanding of the different roles of all involved in the sector
• An apprecitation of the risk characteristics and lessons learned from the credit crunch
• The advantages and disadvantages of investing in hedge funds
• A clear understanding of the regulation of hedge funds and the key legal issues
• The latest developments in the hedge fund industry

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Day 1

Why hedge funds?

• The rise of alternative investments
• The market for hedge funds and its recent growth
• Benefits of adding hedge funds to traditional portfolios
• Hedge fund terminology
• Hedged funds or funds that call themselves hedge funds
• Recent evolution in hedge fund land vis-à-vis traditional investment market decline in 2009

The delegates will be able to define an alternative investment vehicle as well as why and how they have become such an important part of the investment world.

Structure and Service Providers

• Hedge fund managers & management companies
• Administrators and custodians
• The role of the Prime Broker
• Outsourced providers and hedge funds
• Due diligence consultants and investor relationships

The delegates will be able to identify the different types of management structure as well as the importance of those bodies providing services to hedge funds.

Hedge Fund Investor Base and its Ongoing Evolution

• The paradigm shift to "absolute return" - style investing
• Different hedge fund styles for different clients
• Understanding the hedge fund selection process of investors
• Hedge fund products from a product sponsor viewpoint
• Reviewing the compelling sales argument for hedge products

Introducing Hedge Fund Strategies

• Typology of hedge fund styles and hedge fund indices
• Directional vs arbitrage investment strategies
• Market neutrality vs market tracking error investment strategies

Day 2

Directional and Hedge Equity Strategies

• Global macro
• Managed futures
• Emerging markets
• Behavioural finance and trading strategies

Case Study: Dissecting a long short fund trading style, leverage, concentration and securities selection process

The delegates will have worked through examples of these strategies and will be able to explain how they operate in practice.

Fixed Interest Hedge Funds

• Credit & capital structure arbitrage
• Government bond arbitrage
• Mortgage backed securities
• Other bond hedge fund styles

The delegates will be have worked through examples of these hedge fund styles and be able to explain their workings to clients.

Arbitrage Styles

• Convertible bond arbitrage
• Risk and index arbitrage
• Capital structure arbitrage

The delegates will have worked through examples of these hedge fund styles and be able to explain their use in performance & diversification.

Derivative Based Hedge Fund Trading

• Managed futures and trending/counter-trending strategies
• Commodity strategies
• Volatility arbitrage

Day 3

Fund of Hedge Funds, Managed Accounts, or Hedge Fund Portfolios

• Obtaining hedge fund exposure
• The buy or build portfolio decision of an institution investor
• The pros and cons of obtaining investment exposure via a funds of hedge funds
• Negotiating a managed account via a platform
• Running an internal portfolio of hedge funds
• Structured products on funds of hedge funds and other recent developments

The delegates will be able to recognise the advantages in the fund of funds model and contrast and compare them against structured and guaranteed products.

The Hedge Fund Manager Selection Process

• The investment due diligence process on hedge fund managers
• Fund documentation and manager meetings
• Ongoing monitoring of a portfolio of hedge funds
• Style-based analysis of funds

Understanding Risk in Hedge Funds

• Hedge funds in recent markets
• Hedge fund performance in the 2008 market meltdown
• 2009 liquidity squeeze on hedge funds
• Understanding the causes of investment market risk in hedge funds
• 2007 market neutral hedge fund meltdown
• Understanding hedge fund liquidity risk
• 2008 Convertible Arbitrage hedge fund disaster
• Understanding investors’ reactions in crisis
• 2009 hedge fund gates
• A review of some of the major hedge fund failures
• Regulatory control of hedge funds – The SEC and opportunities & threats
• The comfort level: defining a solid well risk managed institutional quality hedge fund

Hedge Fund Risk Management

Case Study: The benefits of Hindsight

Delegates will be able to analyse and understand the recent developments in markets and the impact they will have on the hedge fund industry.

This is the most comprehensive overview of the hedge funds market available, which is exactly what you need, given the difficulties faced within this industry. There's no denying that the reputation of hedge funds took some damage during the credit crisis but people now realise that they are not the bad guys after all and excellent returns are possible when investing in this area. This hedge funds course will dispel some of the confusion around the products and will help you understand the opportunities they can offer.