Equity Market Neutral

Equity Market Neutral investing seeks to profit by exploiting pricing inefficiencies between related equity securities, neutralizing exposure to market risk by combining long and short positions. Typically, the strategy is based on quantitative models for selecting specific stocks with equal dollar amounts comprising the long and short sides of the portfolio. One example of this strategy is to build portfolios made up of long positions in the strongest companies in several industries and taking corresponding short positions in those showing signs of weakness. Another variation is investing long stocks and selling short index futures.

FREE Live Data on 6136 Hedge Funds & CTAs

 

Related Terms:

• Efficiency Index definition
• Time Windows definition
• Equity Market Neutral definition
• Fixed Income Mortgage Backed definition
• Value Added Monthly Index VAMI definition

Back to definitions home page >>