Guest contributor Professor Harry Kat examines the creation of alternative beta using mechanical trading rules.

Our exclusive survey of hedge fund managers, investors and consultants reveals how "hedge fund replication" is actually being embraced by some hedge funds.

Partners Group's Lars Jaeger says that although you could have replicated hedge funds using equity beta over the past 4 years, "alternative beta" is still where it's at.

A European hedge fund manager announced today that it will be using Prof. Harry Kat's "FundCreator" software as a risk management tool. Kat says it's not about "replication" any more.

We’ve been writing about hedge fund “replication” for a while and tracking the latest news on this topic.  Now it’s your turn to sound off on the issue.  Is it a genuine threat to the hedge fund industry or is it a sad attempt to discredit hedge funds?  Or is it something in between? Click here [...]

Another major player entered the hedge fund replication game today with a product based on technologies previously used in the machine learning and missle defense industries.

There is a lot of talk about how hedge fund returns can be "replicated" using liquid derivatives, swaps, futures, and "exotic beta". But what about good old-fashioned ETFs?

If hedge fund indices can apparently be replicated using traditional risk factors such as equity risk, why can't private equity funds?

Like Johnny Cash, are hedge funds also "walking the line" by staying true to their mandate to produce alpha?

Regular readers may recall this story we did on a research study by Edhec, the French business school, last spring.  The study contained a comprehensive analysis of various so-called hedge fund replication strategies.  At the time we directed you to Edhec if you wanted to buy the whole report since it wasn’t available to the [...]

One of our favorite institutional asset managers makes familiar argument this week about the high correlation between run of the mill betas and hedge fund indices.

Hedge funds have traditionally eked out a living by exploiting market inefficiencies to deliver alpha. But it seems that hedge funds have now also become an important source of "alternative beta".

AllAboutAlpha.com welcomes a special guest posting from one of the big names in institutional asset management, Laurence Siegel of the Ford Foundation. Here's what he has to say about "exotic beta".

France's Edhec business school published a succinct summary of hedge fund replication offerings last week. It's well worth the read - especially if you're a Jedi knight.

What's the difference between a hedge fund clone and a real hedge fund? Humans, according to Boston University's Jonathan Treussard. But how much human capital is too much?

CAIA Association member, Ryan Teal, says hedge funds ought to take inspiration from Jesse James when addressing hedge fund replication, "Do you want to be LIKE me? Or do you want to BE me?"

At a conference last week, Professor Harry Kat of hedge fund replication fame presented a list of his specific rebuttals to 10 criticisms. He added the audience's feedback to a new article on distributional replication.

Professor Bill Fung presented some interesting charts in Geneva showing the performance of various hedge fund replication strategies during the tumultuous summer months. Unfortunately, it looks like hedge fund replicators replicated August pretty well.  Here is the game tape: But what’s particularly striking about this performance graph, aside from the drawdown, is the dispersion between replication strategies in [...]

Day 2 of Terrapinn's Hedge Fund Replication & Alternative Beta conference in Geneva saw black swans, persistence and virgin beta.

Here are a few more tidbits from the Hotel President Wilson here in Geneva… “I’m thinking about launching an index fund of replicated hedge fund index funds!” - John Godden, IGS Group, jokes about a fund of funds to replicate the replicators “Alternative beta is like sex in high school.  Everyone talks about it, but no one is actually [...]

Day 1 of the Hedge Fund Replication & Alternative Beta conference in Geneva was a rip-roaring juggernaut of financial excitement. If you missed it, we've got all the gory details...

Heard on the floor at Terrapinn’s “Hedge Fund Replication & Alternative Beta” conference in Geneva so far today… “His trading process may be “naive”, but his fees sure aren’t!” - Professor Harry Kat on the hedge fund replication strategy pursued by another well-known firm. “The asset information submitted to any of the databases is absolutely useless.  How many [...]

Anecdotal evidence suggests quant funds were all sitting together when pandemonium recently broke out.

Not content to spend the summer idly relaxing at the beach, 'The Flying Dutchman' Professor Harry Kat, speaks out about what he sees as continuing misconceptions concerning hedge fund replication.

With hedge fund risk on all of our minds these days, we invite former hedge fund risk manager Tammer Kamel to comment on hedge fund replicators. Apparently, he's unconvinced of their wizardry.

A recent Merrill Lynch report suggested that hedge fund replication is a solution to the common fear of "headline risk" from investing in hedge funds that blow up.

Apparently, the "good old fashioned Kat fight" we predicted yesterday has already begun.

A new paper has just been released on "distributional" hedge fund replication. But it's not from the method's original developer, Harry Kat. It proposes some improvements and heralds the entry of a new player in this space.

Alpha Male takes a break and turns the mic over to guest poster Professor Harry Kat who explores the commonly-cited phenomenon of hedge fund capital preservation during the 00-03 bear market. Was it alpha?

Edhec Risk and Asset Management Research Centre released its latest research into hedge fund replication techniques today at a seminar in London. Its verdict: "attractive" but "unsatisfying".

Forbes "Build Your Own Hedge Fund" story this week is the latest in a rich lineage of similarly populist articles.

That recent paper from Northwater Capital on hedge fund replication techniques has garnered a lot of interest and is quickly becoming one of our most downloaded documents ever.  But we’ve also had a few queries regarding where to download the document.  Unless you’re a client of Northwater’s, you can only find the paper here at AllAboutAlpha.com.  Our apologies for not [...]

The hedge fund industry has taken it on the chin from "hedge fund replicators". But a new study finds evidence that hedge funds might produce value after all.

Deutsche Bank's new Absolute Return Beta Index is apparently trying to take a different tack than its competition. Unfortunately, however, it may face the same headwinds.

In a follow-up to our posting on kurtosis (a.k.a. "fat tails"), Alpha Male chats with William Shadwick, winner of the Investment Managament Consultant's Association 2007 Journalism Award for his unique take on tail risk.

Professor Harry Kat of the Cass Business School at City University, London, has been a thorn in the side of the hedge fund industry for several years now.  And today (April 30), he released his latest attack on the sector, reserving his sharpest barbs for the hedge fund replicators themselves.  In fact, he concludes his [...]

Bill Fung and David Hsieh write in the Banque de France's bi-monthly "Financial Stability Review" that hedge fund replication should eventually reduce hedge fund management fees.

Location: New York Dates: October 29-31, 2007 Organized by: Terrapinn Hedge funds aren’t the only thing replicating these days. February’s wildly successful “Alternative Beta & Hedge Fund Replication” conference in London has replicated itself – spawning two additional events within the course of a year. Both carry the same title and bring this hot topic to the shores [...]

Ed Easterling, author and adjunct faculty at Southern Methodist University’s Cox School of Business writes a handy paper on "hedge fund myths". A must read for those seeking balance in hedge fund reporting.

Bridgewater is the quintessential "alpha-centric" investor. But in this note, it argues that hedge funds are overly leveraged, replicatable using simple factors, and unlikely to perform when risk increases.

Edhec Business School researcher and hedge fund practitioner, Francois-Serge L'habitant doesn't mince words regarding hedge fund replication.