Alternative Investments

A comprehensive guide to alternative investments — what they are, the five major asset categories, the illiquidity premium, and how institutional investors use them in the endowment model.

A comprehensive guide to hedge fund risk management covering leverage types, liquidity risk mechanics (gates, side pockets, redemption mismatches), drawdown analysis, style drift detection, NAV manipulation indicators, and practical monitoring frameworks.

A detailed guide to hedge fund fee structures covering 2-and-20 mechanics, high-water mark calculations, hard vs soft hurdle rates, clawback provisions, the free option problem in incentive fees, and fund-of-funds double-layer fees.

Hedge fund due diligence covers the IDD and ODD framework institutional allocators use to evaluate managers — including DDQ structure, regulatory checks, red flags, and fund of funds as delegated due diligence.

Learn what managed futures are, how Commodity Trading Advisors use trend-following strategies, what crisis alpha means, and whether managed futures belong in your portfolio.

A comprehensive guide to hedge fund benchmarks: the major index families (HFRI, CSFB/Tremont, MSCI), the four structural data biases that inflate reported returns by 3-4.5% annually, and how weighting methodology and investability tradeoffs affect performance measurement and asset allocation.

Learn how shareholder activism works as an alternative investment strategy — activist strategies, Schedule 13D filings, proxy fights, universal proxy rules, and CalPERS return evidence.

A comprehensive guide to mezzanine financing — subordinated debt structure, PIK interest, equity kickers, LBO capital stack positioning, return expectations (15-20% IRR), and comparison to high-yield bonds.

A collateralized fund obligation (CFO) is a structured bond backed by hedge fund interests via a special purpose vehicle and fund of funds. Learn CFO capital structure, issuance rationale, risk factors, and how they differ from CDOs.

Learn why commodities improve portfolio diversification through inflation hedging, negative equity correlation, and roll yield — with evidence-based allocation sizing and a commodities vs TIPS comparison.

Learn how to evaluate private equity fund performance using PME (Kaplan-Schoar, Long-Nickels, Direct Alpha), vintage year benchmarking, and how to identify subscription-line IRR distortion, return smoothing, and database biases.

Learn how distressed debt investing works — from identifying the fulcrum security and navigating Chapter 11 bankruptcy to understanding active vs passive strategies and risk-return characteristics.