Real Estate Risk and Hedge Fund Returns

Posted: 4 Mar 2016

See all articles by Brent W. Ambrose

Brent W. Ambrose

Pennsylvania State University - Department of Insurance & Real Estate

Charles Cao

Pennsylvania State University

Walter D'Lima

Florida International University (FIU) - Hollo School of Real Estate

Date Written: March 1, 2016

Abstract

We explore a new investment dimension relating hedge fund exposure to the real estate market. Using fund level data from 1994 to 2012 from a major hedge fund data vendor, we identify 1,321 hedge funds as having significant exposure to direct or securitized real estate. We test for the economic impact of real estate exposure. Our analysis shows that real estate exposure does not increase fund performance.

Keywords: Hedge funds; Real estate; Perofrmance analysis; Portfolio theory

JEL Classification: G11, G12, R30

Suggested Citation

Ambrose, Brent W. and Cao, Charles and D'Lima, Walter, Real Estate Risk and Hedge Fund Returns (March 1, 2016). Journal of Real Estate Finance and Economics, Vol. 52, No. 3, 2016, Available at SSRN: https://ssrn.com/abstract=2740555

Brent W. Ambrose (Contact Author)

Pennsylvania State University - Department of Insurance & Real Estate ( email )

Smeal College of Business,
Penn State University
University Park, PA US-0-PA 16802
United States
8148670066 (Phone)

HOME PAGE: http://https://sites.psu.edu/brentwambrose/

Charles Cao

Pennsylvania State University ( email )

Department of Finance
Smeal College of Business
University Park, PA 16802
United States
814-865-7891 (Phone)
814-865-3362 (Fax)

HOME PAGE: http://www.personal.psu.edu/qxc2/cao.html

Walter D'Lima

Florida International University (FIU) - Hollo School of Real Estate ( email )

Miami, FL 33199
United States

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