We examine whether investor sentiment affects hedge fund companies' decision to start new funds. We find significantly more fund inceptions in hot markets than in cold markets. Moreover, funds opened in hot markets exhibit weaker subsequent performance, higher risk of fraud, and shorter...

Alternative alpha represents risk-adjust absolute return of an alternative investing instrument regressed on alternative risk factors. Over the years, the definition is extended to the absolute return generated from alternative asset speculation -- long-only or long-short strategy on alternative...

The authors investigate whether sports traders who systematically invest in sports betting strategies can outperform hedge fund managers and the S&P 500 from 1st January 2010 to 7th January 2016. The authors take a simple betting strategy based on Horse races in the UK and invest consistently on...

This study examines whether funds of hedge funds (FOHFs) provide superior before-fee performance through managers' fund selection, style allocation, and active management abilities. Using reported holdings of SEC-registered FOHFs, we find that FOHF managers have fund selection abilities, as...

This paper examines the causes and consequences of hedge fund investments in exchange traded funds (ETFs) using U.S. data from 1998 to 2018. The data indicate that transient hedge funds and quasi-indexer hedge funds are substantially more likely to invest in ETFs. Unexpected hedge fund inflows...

Alternative Mutual Funds (AMFs) follow strategies similar to those of hedge funds and seek returns uncorrelated with the market. We analyze the performance of AMFs for the period January, 1998 through December, 2011 using the Carhart four-factor model and the Fung-Hsieh seven-factor model. Our...

This study examines whether the standard compensation contract in the hedge fund industry aligns managers' incentives with investors' interests. I show empirically that managers' compensation increases when fund assets grow, even when diseconomies of scale in fund performance exist. Thus,...