Q v3
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+42 | Compiled Bondarb's Comment History | 5 | 1d | |
+34 | T2 Hedge fund or T1 LO/AM? | 11 | 2d | |
+31 | Non-GAAP Income Statement | 6 | 1d | |
+22 | Thoughts on MMF | 12 | 2s | |
+21 | Are most HF opportunities actually not in L/S equities? | 9 | 3d | |
+19 | Top LO AM culture, comp, exit opps, etc. | 4 | 2d | |
+19 | How do you get up to speed as a consultant on finance? | 3 | 1d | |
+18 | How to Structure Bonus Comp for Analyst | 5 | 16h | |
+17 | MLP portfolio manager guaranteed payouts? | 18 | 3h | |
Joining buy-side directly at boutique AM or ER at BB for HF future? | 9 | 5d |
Career Resources
why do you think they do it
this is such a dumb & poorly phrased question
X
A long/short manager adds value through the spread between their shorts and longs. If the market rips 20% and your long book goes up 30% while your short book is up 10%, then you've done very well, even though your shorts have lost value.
... done very well? you mean performed exactly like the market..
This hypothetical 20% spread is alpha, not beta.
if you're just playing the intra-sector spread, doesn't matter. just need shorts to underperform longs.
if your shorts are meant to be standalone profit generators, >20% over next 12 months.
it depends on how long you intend to hold the position....generally you are targeting at least 20% annually....but if uoi only intend to hold a position for a few days/weeks....then do the math. 1 year = ~250 trading days 1/250 = .04%
So, you would hope/expect to average 0.04% per day...and so for example, if you make 1% on an outright short position in 1 day...that = 25 days worth of "annualized return" (the equiv of making IRR of 20%*25 = 500% annualized).
Not all position are intended to be held for the long term. If you can make 1% here and 1% there...over the year that can add up to big $$
Prob as long as the investment makes money on its own that may be acceptable
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