hedge fund

Hedge Fund Management
Course Description, Fall 2008

Three ingredients are essential to the success of hedge funds: trading
strategies; capital; and infrastructure and good internal controls. While
the first two seem obvious, the third is equally important. For example,
one can develop a strategy that generates much profit when traded on paper,
but unless the fund has a good relationship with a prime broker, if the
strategy involves hard-to-locate short sales to hedge long positions, the
fund will not be able to execute the hedged positions. Another example is
risk management, which recent market events make clear.

This Course will cover critical managerial aspects and characteristics of
hedge funds and the hedge-fund industry. It intends to look at the legal
foundations and structures of hedge funds including the primary regulations
in the U.S. that are most relevant to hedge funds. It intends to describe
operations, control, administration, due diligence, and valuation issues.
Furthermore, while explicitly not a course on hedge-fund trading techniques,
it will introduce a sampling of basic and esoteric hedge-fund strategies
from a general perspective so that Members better understand the concept of
absolute-return strategies. Moreover, it may discuss performance evaluation
and investing in hedge funds from the investor's perspective, as well as
issues of potential changes in regulation, risk management, and the use of
leverage. The Course may touch upon ethics in the industry. It is designed
to be a multi-functional Course that focuses on practical aspects of
hedge-fund management.

The Course may focus on issues relating to starting and running a hedge fund. Moreover, the knowledge gained in the class will conclude with groups
presenting their strategy, structure, and controls for their own mock hedge
fund to investment professionals who will critique such fund.

Upon the Course's completion, Members who attend the Course should have a
broad understanding of essential knowledge one needs to launch a hedge fund
successfully, provided that such Members have a trading strategy and access
to capital. Nevertheless, it is unlikely that Members who register for this
class will learn enough information that will enable them to launch a fund
without hiring legal counsel and other advisers.

Members, whose reason for enrolling is an expectation that they will learn
winning trading strategies, may be disappointed, and are discouraged from
enrolling.