In contrast with high-net-worth individuals, who focus on absolute returns, the more recent investors in the hedge fund universe - especially institutional investors - require risk-adjusted performance measures.
Unfortunately, there are limitations to traditional performance measures, such as the Sharpe ratio and multi-factor models. Therefore, hedge fund indices have received increasing acceptance.
However, hedge fund indices suffer from numerous theoretical shortcomings and practical challen
The week on Risk.net, July 14–20, 2017Receive this by email