Moderated, page-1113

a hedge fund can be many things and anything depending on their investment strategies and thesis, but we know they can and do short and that they are only open to sophisticated investors that tick certain boxes (certain level of income, certain level of net assets etc.). Typically their trades are based on pairs, and building off that into structures. The classical/textbook strategy is trading stationarity between two stocks or a portfolio of long and shorted stocks that is statistically stationary (statistical arbitrage), but this idea can be transferred into trading volatility (long vix, short stocks that are going to be relatively less volatile), time decay (straddle trade) etc. They also trade corporate activity arbitrage (takeovers - e.g long target short acquirer), fundamental arbitrage (long coca cola short pepsi co), and probably various other strategies not know to the public where they have an informational advantage.