Hedge Funds


Returns Not Subject to Market Fluctuations

Hedge funds represent the activities of investment teams which use complex strategies to produce a return that is not linked to fluctuations in financial markets. Hedge funds account for 5% of the Caisse’s overall portfolio (as at December 31, 2007).

The Caisse has investments in some 80 external hedge funds. These funds cover the three types of strategies used in this investment profession:

• Relative value strategies;
• Event-driven strategies;
• Directional and tactical strategies.

The Caisse’s portfolio also includes internal hedge funds specializing in:

• Quantitative strategies based on econometric models for forecasting returns;
• Arbitrage activities on commodity prices (e.g.: oil, natural gas, metals, cereals);
• Investments based on an analysis of economic and financial trends.

The Caisse’s portfolio managers’ approach consists of:

• Identifying market inefficiencies through an ongoing analysis of the factors that could affect the returns on financial markets;
• Using quantitative methods to identify investment opportunities;
• Rigourously managing risks when implementing strategies and executing transactions.

For more information: Hedge Funds Team.

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Additional Information
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