Reviewing the Hedge Funds Literature II: Hedge Funds' Returns and Risk Management Characteristics
Posted: 21 Jan 2018
Date Written: December 2016
This paper summarizes the literature on hedge funds (HFs) developed over the last two decades, particularly that which relates to risk management characteristics (a companion piece investigates the managerial characteristics of HFs). It discusses the successes and the shortfalls to date in developing more sophisticated risk management frameworks and tools to measure and monitor HF risks, and the empirical evidence on the role of the HFs and their investment behaviour and risk management practices on the stability of the financial system. It also classifies the HF literature considering the most recent contributions and, particularly, the regulatory developments after the 2007 financial crisis.
Keywords: Hedge Funds, Return Characteristics, Risk Management Characteristics
JEL Classification: G20, G23
Suggested Citation: Suggested Citation