Long Short Fund Overview

By Author: Jamie Hanson
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Are you an investor interested in diversifying your portfolio? If so, then perhaps you will want to consider adding a long short fund to your investments. Basically, the long short fund is a mix between a mutual fund and hedge fund. The biggest difference is that the long short fund mutual fund offers daily liquidity and charges no performance fee. The use of short positions, leverage, and derivatives give the long short fund an advantage over other types of investments.

Of course, potential long short fund investors should keep in mind that this type of investment is not unregulated but rather there are laws that govern how derivatives and short positions are used within the fund. Due to this there are some restraints on the overall risk level of the long short fund, but that is the nature of this type of investment.

There are many different types of investments that may be chosen for a long short fund and they may span the entire stock market or only specific sectors. Of course, many investors have never even heard of a long short fund much less considered investing in one. However, these types of investments ...
... are up and coming and have been gaining in popularity lately. This is partly because the long short fund really has something special to offer investors as well as the fact that they really do perform well in all market conditions. The way the long short fund will perform over the next few decades is yet to be known and investors will need to take some risks in order to take advantage of the benefits the long short fund can offer. Keep in mind that while this type of fund is designed to weather the market's ups and downs there is no guarantee that it will produce positive returns year in and year out. That may be its strategy and investors are hoping it rings true, but investing in the stock market is risky business despite the reduction in volatility offered by long short funds.

Research the long short fund and learn more about how this type of investment might be the method for you to continue to invest in the stock market without as much risk or exposure as you may have experienced with other investments.

Long-Short mutual funds are offered by Bull Path Capital Management, a New York based registered equity asset management firm specializing in long-short strategies.