Handbook of Alternative Assets, 2nd Edition

Preface ix

About the Author xi

PART ONE Overview of Alternative Assets 1

CHAPTER 1 What Is an Alternative Asset Class? 3

CHAPTER 2 Why Alternative Assets Are Important: Beta Drivers and Alpha Drivers 15

PART TWO Hedge Funds 29

CHAPTER 3 Introduction to Hedge Funds 31

CHAPTER 4 Establishing a Hedge Fund Investment Program 71

CHAPTER 5 Due Diligence for Hedge Fund Managers 97

CHAPTER 6 Risk Management Part I: Hedge Fund Return Distributions 135

CHAPTER 7 Risk Management Part II: Additional Hedge Fund Risks 169

CHAPTER 8 Regulation of Hedge Funds 203

CHAPTER 9 Hedge Fund Benchmarks and Asset Allocation 229

CHAPTER 10 Hedge Fund Incentive Fees and the “Free Option” 251

CHAPTER 11 Top Ten Hedge Fund Quotes 265

PART THREE Commodities and Managed Futures 275

CHAPTER 12 Introduction to Commodities 277

CHAPTER 13 Investing in Commodity Futures 305

CHAPTER 14 Commodity Futures in a Portfolio Context 333

CHAPTER 15 Managed Futures 353

PART FOUR Private Equity 377

CHAPTER 16 Introduction to Venture Capital 379

CHAPTER 17 Introduction to Leveraged Buyouts 419

CHAPTER 18 Debt as Private Equity Part I: Mezzanine Debt 455

CHAPTER 19 Debt as Private Equity Part II: Distressed Debt 477

CHAPTER 20 The Economics of Private Equity 501

CHAPTER 21 Performance Measurement for Private Equity 523

CHAPTER 22 Trends in Private Equity 553

PART FIVE Credit Derivatives 577

CHAPTER 23 Introduction to Credit Derivatives 579

CHAPTER 24 Collateralized Debt Obligations 609

CHAPTER 25 Collateralized Fund Obligations: Intersection of Credit Derivative Market and Hedge Fund World 653

PART SIX Corporate Governance 667

CHAPTER 26 Corporate Governance as an Alternative Investment Strategy 669

Index 695