The Alternative Investment Fund’s assets are managed in four funds, the Relative Value, Global Macro, Special Situations Group, and Risk Group. Each group has a different investment strategy:
We seek to take advantage of mis-pricing of securities in the financial markets by identifying undervalued and overvalued equities and bonds. We conduct pair trades, matching long position with a short position to hedge our risk. We further may conduct capital structure arbitrage, taking advantage of differential pricing in various securities issued by one corporation.
We analyze international markets and use macroeconomic principles to identify dislocations in asset prices. Members analyze economic indicators, secular and cyclical trends, and political events to come up with fundamentally based trade ideas. Trades will frequently involve currencies, commodities, government bonds, and investment in various indices around the world.
We explore event-driven strategies and exploit asymmetric information regarding proper valuations. Members analyze mergers, acquisitions, spinoffs, IPOs and more to determine proper value, as frequent mispricing occurs due to market inefficiency.
We utilize various methods to ensure our portfolio is hedged accordingly and is not exposed to one particular sector or economy. While the other three strategies seek investments to maximize return, the Risk Group takes steps to minimize exposure. Members analyze the portfolio as a whole and also determine the additional risk taken if AIF enters a new position. We use methods such as correlational analysis, Value at Risk, and portfolio beta. The Risk group implements measures to limit risk which may include forward or option hedging or entering a counter position. A prior background in statistics and/or computer science is preferred.