Asked by LaQuesha Jewell on Jul 26, 2024
Verified
Hedge fund strategies can be classified as
A) directional or nondirectional.
B) stock or bond.
C) arbitrage or speculation.
D) stock or bond and arbitrage or speculation.
E) directional or nondirectional and stock or bond.
Nondirectional
Trading strategies not dependent on the market's direction, aiming to profit regardless of whether prices are rising or falling.
Directional
In investing, this term refers to strategies or trades based on the anticipated direction of the market or an asset's price movement.
Arbitrage
A zero-risk, zero-net investment strategy that still generates profits.
- Pinpoint and contrast several hedge fund strategies, including those that are market neutral, directional, and involve arbitrage.
Verified Answer
JD
Jordy DominguezJul 27, 2024
Final Answer :
A
Explanation :
Hedge fund strategies are broadly classified into two main categories: directional, which bets on the market's direction, and nondirectional, which seeks to make profits regardless of the market's direction.
Learning Objectives
- Pinpoint and contrast several hedge fund strategies, including those that are market neutral, directional, and involve arbitrage.
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