Offshore banking and asset management

Hedge funds use sophisticated investment strategies to achieve excellent rate of return. Keyinvest actively seeks to find the hedge funds that surpass the regular hedge funds norm for returns with a risk that still matches our clients risk profile.

Hedge funds can be seen as complex and daunting investment vehicles. By using clear language, however, we help our clients understand hedge fund opportunities, the approach they should take to term and the role they should play in their portfolio.

Sophisticated
Hedge funds can be an interesting alternative to stocks or mutural funds. Investing part of a portfolio in hedge funds can reduce exposure to market risks inherent in traditionally portfolios. Hedge funds are less susceptible to some market risks and typically outperform their conventional, market-dependent counterparts during periods of volatility and decline. In addition, hedge fund strategies can provide highly diversified access to the biggest markets and the most sophisticated investment strategies.

Strategies
Hedge funds strategies can provide access to instruments, markets and investment techniques not used by traditional investment programs. In addition, hedge funds pursue a specific absolute return rather than seeking to outperform a benchmark. Hedge funds include traditional stock and fixed incomes, but generally combines these with sort sales, arbitrage and leverage not found in traditional stock and bond market strategies.

When investing in hedge funds it is important to understand three strategies.

First, hedge fund can sell short. This means stocks are borrowed and then sold, with a promise to buy the back in the future. If the share price drops, the difference in price is profit

Second, hedge funds may use leverage. Funds may borrow money to increase the size of their portfolio.

Third, hedge funds can use arbitrage. These are strategies that attempt to exploit temporary price discrepancies between similar securities through buying the cheaper one and selling short the more expensive one.

All type of hedge funds have some characteristics in common: the objective of securing absolute returns, the ability to sell short and the goal of producing positive returns in all market conditions.

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Last modified: 02/25/05