Even the least sophisticated of hedge fund investors understand that alpha is something to be pursued. The irony is that many an investor and fair few hedge fund professionals only have a vague understanding of what alpha really is or the important principles that underlie it. Alpha's precise definition, its short supply, the impediments to finding it, and its real utility are not well understood. This article corrects this by presenting an intuitive explanation of what alpha really is.

The Sharpe ratio is a misinterpreted and dangerously deceptive metric. When used to characterize the risks and returns of hedge funds, the number often misrepresents the fund to the detriment of naïve investors. This article looks at the endemic misuse of Sharpe Ratios in the hedge fund industry.

Hedge Fund Replication, though in its nascence, is enjoying a great deal of interest. A number of different approaches have recently been postulated by practitioners and academics. This article examines a number of them, commenting on their rationale, feasibility and prospects for success.