Hedge Fund Risk Fundamentals Solving the Risk Management and Transparency Challenge

In the constantly evolving hedge fund marketplace, nothing is more central but in many ways, more elusive than risk. Yet there remains no standard for analysing and measuring risk within this highly secretive, largely unregulated field, leaving the thousands of hedge funds, and the tens of thousands of hedge fund investors, in dangerously dim light. The industry has not solved the "transparency" challenge of communicating risk to investors without disclosing proprietary information. Hedge Fund Risk Fundamentalshighlights these issues clearly and concisely as the author, Richard Horwitz, lays out the key components and the cutting-edge processes in the field of hedge fund risk management. This book presents a groundbreaking resource destined to set the standard for transparency in risk management within the hedge fund universe.

Richard Horwitz is managing director of manager assessment and risk management of Merrill Lynch's Hedge Fund Development and Management Group (HFDMG). He has implemented Risk Fundamentals, a proprietary risk transparency and management system. The system is risk factor based, permitting underlying funds to provide structural risk transparency without requiring position disclosure and for this transparency to be used to provide a fundamental understanding of each underlying fund and to construct risk-efficient portfolios of funds. Previously, Horwitz was senior vice president and director of risk management and investment analytics at Kenmar Global Investment Management Inc., a $2 billion fund of funds. He gained his fundamental knowledge of hedge funds as a principal at Capital Market Risk Advisors, Inc., the boutique risk management consulting firm. Horwitz had previously been a buy-side senior equity analyst at Sanford C. Bernstein & Co. and a consultant in financial services at Booz Allen Hamilton Inc. He earned an MS in management (Sloan School) and a BS in electrical engineering from the Massachusetts Institute of Technology. Horwitz has also written numerous articles on hedge funds.