Being short apparently has its benefits
May 10th, 2010 | Filed under: 130/30, Academic Research, Retail Investing, Today's Post
Last week we told you about a survey of institutional investors that found resistance to the idea of hedge funds managing long-only funds and vice versa. Today, we’ll revisit the topic of “convergence” from a retail investor’s standpoint.
Whether they are managed by alternative or traditional managers, mutual funds with hedge-like strategies have been growing in popularity for some time. A new study by Jingzhi Huang of Penn State University and Ying Wang of SUNY-Albany (“Should Investors Invest in Hedge Fund-Like Mutual Funds? Evidence from the 2007 Financial Crisis“) concludes that these hedged mutual funds outperformed the market during the financial crisis, but that there is more to the story than meets the eye… More…
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130/30 has apparently gone from the cat’s meow to doggone unpopular.
Since 130/30 or “short-extension” funds entered the investment lexicon over 3 years ago, it has generated considerable debate. While industry commentators derided the strategy in the media, academics remained steadfast in their belief that short extension strategies have merit.
Looks who’s making a return trip to the news after being largely tossed away by the media last year. It’s alternative beta and 130/30. As regular readers will recall, these hedge fund relatives seems to have died off 

