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Global: Macro, International, and Emerging Markets Global: Macro, International, and Emerging Markets

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January 25, 2009
January 25, 2009
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Definitions of the Global strategies; explanation of discretionary and systematic managers
Global strategy funds benefit from predicting the impact of changes in global economies. Typically, those funds use financial instruments like currencies, stock indices, commodities, and bonds. While the Global International strategy implies picking equities around the world, Emerging Markets’ funds focus on developing and emerging economies. Most often Emerging Markets portfolios tend to be only long because of short selling restrictions in developing countries. Global Macro funds extensively use leverage and derivatives, whereas Emerging Market ones - stocks and bonds only, because futures and options are not available.

According to the Deutsche Bank’s classification, global strategies can be divided into two subcategories: discretionary and systematic. Discretionary managers make their decisions based on their own views and perceptions of the markets, whereas systematic managers are driven by quantitative researches. In principle, a discretionary-systematic categorization presents an independent classification criterion, so any strategies can be subdivided this way.
Article is in the following categories:
Quant KB » Due Diligence» Hedge Fund Strategies

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