iluka is a consultancy specializing in hedge fund investing, quantitative analysis and risk management. We serve a diverse set of clients including hedge fund managers, family offices, pension funds and high net worth individuals.
In many cases asset growth presents challenges to hedge fund managers. But there is one, and only one, strategy that is not only immune to growing pains but actually continually improves with size. It is no coincidence that the handful of perennially successful multi-billion dollar equity hedge funds all have this strategy at their core.
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.