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Lawrence Lewis wrote:
>
> ----------
> Dear RealTraders,
>
> I am interested in any comments regarding hedge strategies of the type
> where one tries to go long the n best stocks in a given universe and
> short the n worst stocks in the same universe, the universe typically
> being the SP500. I've looked at www.trendvest.com, and they seem to show
> impressive results, especially on a risk adjusted basis. Unfortunately, I
> don't have the cash to have a portfolio of 50 to 100 stocks that need to
> be rebalanced often without transaction costs eating me up.
>
> Has anybody tried this? I've also heard about a firm called Tiger
> Management (saw them on CNBC one morning), but I don't know how to
> contact them. Anyone know?
>
> Larry Lewis
Larry,
These are called Market Neutral funds. I like them too but they are not
really available for the little guy yet.
Tiger Management is one of the biggest names in the business. They are
geared toward LARGE institutional investors. In other words, if you
don't have the cash for the 50-100 stocks as you say in your post, you
can't get into Tiger.
The good news is due to the recent changing of the "short short" rule,
this area of investing will very shortly be opened up to the small guy.
Several large mutual fund groups are currently setting up market neutral
funds. Start looking for them in the first Q of 1998. Beware though
and do your due diligence on who is running these to make sure they are
experienced.
Good Luck,
Eric
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