Comments on: Is 130/30 Always “High Conviction”? http://allaboutalpha.com/blog/2007/07/25/is-13030-always-high-conviction/ A finance blog about hedge funds, portable alpha and alternative investing. Thu, 09 Feb 2012 19:03:08 +0000 http://wordpress.org/?v=abc hourly 1 By: Risk management and high conviction investing « Abnormal Returns http://allaboutalpha.com/blog/2007/07/25/is-13030-always-high-conviction/comment-page-1/#comment-15956 Risk management and high conviction investing « Abnormal Returns Thu, 26 Jul 2007 15:50:03 +0000 http://allaboutalpha.com/blog/2007/07/25/is-13030-always-high-conviction/#comment-15956 [...] 130/30-type funds have become popular in that they are designed to allow institutional investors to have greater latitude to implement security selection while maintaining a (relatively) constrained risk profile. This is in contrast with many hedge funds where risk parameters are entirely less rigid. The always excellent All About Alpha blog has a post up on the question of whether 130/30 or 1X0/X0 funds are really and truly “high conviction” investment vehicles.  As they write: Therefore, if you’re looking for a concentrated fund, don’t assume that 130/30 fund necessarily fits the bill. In the end, a particular 1X0/X0 strategy might not actually be ”high conviction” at all. The irony is that 1X0/X0 strategies actually represent a way for managers to express more of their beliefs, not to necessarily express those same beliefs with a “higher conviction”. [...] [...] 130/30-type funds have become popular in that they are designed to allow institutional investors to have greater latitude to implement security selection while maintaining a (relatively) constrained risk profile. This is in contrast with many hedge funds where risk parameters are entirely less rigid. The always excellent All About Alpha blog has a post up on the question of whether 130/30 or 1X0/X0 funds are really and truly “high conviction” investment vehicles.  As they write: Therefore, if you’re looking for a concentrated fund, don’t assume that 130/30 fund necessarily fits the bill. In the end, a particular 1X0/X0 strategy might not actually be ”high conviction” at all. The irony is that 1X0/X0 strategies actually represent a way for managers to express more of their beliefs, not to necessarily express those same beliefs with a “higher conviction”. [...]

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