Chapter 15: Alternative Mutual Funds, Closed-End Funds, and Hedge Funds

In this section

• Use of Derivatives by Alternative Mutual Funds and Closed-End Funds
  Discover how alternative mutual funds and closed-end funds use derivatives for leveraging, hedging, and enhancing returns, along with Canadian regulatory requirements, risk management, and real-world examples.
• Hedge Funds Compared to Alternative Mutual Funds
  Explore key differences in structure, fees, liquidity, and regulatory oversight between hedge funds and alternative mutual funds, including lock-up periods, daily redemptions, and the role of derivatives.
• Types of Alternative Strategies: Hedge Funds, Liquid Alts, and Market-Neutral Approaches
  Explore the diverse range of alternative investment strategies used by hedge funds and Canadian liquid alternative mutual funds, including long/short equity, market-neutral, credit, global macro, event-driven, and managed futures. Understand key risks, regulatory considerations, and real-world applications in pursuit of absolute returns and portfolio diversification.
• Advantages and Disadvantages of Derivatives
  Explore how leverage, hedging, liquidity, and flexible exposure give alternative funds and hedge funds an edge through derivatives while balancing regulatory obligations, complexity, and potential pitfalls.
• Expanded Hedge Fund Strategies (Global Macro, Managed Futures, Relative Value)
  Explore how hedge funds leverage sophisticated derivatives and unique trading approaches through Global Macro, Managed Futures, and Relative Value strategies.
• Valuation & Liquidity Challenges in Alternative Products
  Explore the complexities of valuing alternative mutual funds, closed-end funds, and hedge funds, along with key liquidity management techniques for daily redemptions and regulatory compliance.
• Operational Due Diligence (Prime Brokers, Service Providers)
  Explore the essentials of operational due diligence (ODD) for hedge funds, closed-end funds, and alternative mutual funds, with a focus on prime brokerage relationships and service providers.