Long/Short Equity: Styles

Market Neutral

Minimal market exposure. Return generated by security selection both long and short. Return goal is commonly T-bills plus 2-4%.

Hedged Equity

Allows exposure to equity market at reduced risk levels as defined by beta, volatility, and drawdown capture (downside capture). Return goal is market returns through a full market cycle with disproportionate upside/downside capture.

Opportunistic

Often tactical with both beta and exposure. These strategies can deploy leverage to gain excess gross exposure; net exposure could be more than 1.0 as well.

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