ETF Trends
ETF Trends

By Yazann Romahi via our partners at Iris.xyz

Alternative beta—accessing hedge fund returns in a liquid low-cost and transparent manner.

The aura of mystery that surrounds hedge funds has allowed them to present their returns solely as a consequence of manager skill, or alpha. Recently, poor aggregate performance has challenged this perception. Have hedge fund managers lost their touch? The truth may rather be that the drivers of their returns are misunderstood.

Beta research lifts the lid on the hedge fund black box. What it reveals is that a large part of the returns of many hedge funds can be attributed to factors widely known in the investment world. These factors can earn premia for taking risks that other investors do not want to (or cannot) take.

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