Overview

This is Module 4 of the Henley Executive Hedge Fund Program (HEHFP). It introduces the aims and practical aspects of Portfolio Management. It also includes an introduction to the valuation of securities including bonds and equities, and concepts associated with market efficiency and prices. Portfolio diversification, the important concept of “Alpha”, and what gives a hedge fund manager “edge” are explained. This module also covers the asset allocation process within a hedge fund together with the risks managed within a portfolio.

This is the most technical module in the program, but advanced mathematics is not required to understand the concepts and it is not necessary to memorise any equations in order to complete it.

This module is a 5.5-hour (approx. study time) course and is eligible for 3.5 SFC CPT/PWMA OPT hours.

Check out the other modules in the Program:

• Module 1: Overview of the Hedge Funds Industry
• Module 2: Structuring & Setup
• Module 3: Capital Raising & Investor Relations
• Module 5: Portfolio Risk Management
• Module 6: Markets and Trading
• Module 7: Prime Brokerage Services
• Module 8: Business Management & Fund Administration
• Module 9: Operations and Technology
• Module 10: Operational Risk Management & Operational Due Diligence
• Module 11: Legal
• Module 12: Ethics (2023)
• Module 13: Compliance
• Module 14: Fund Governance
• Module 15: Tax, Audit & Accounting
• Module 16: Human Resources
• Module 17: Pitchbook Formation

Objective

By the end of this module, you will be able to:
- Recongise how to value securities including bonds and equities
- Explain the important concept of risk and return, and "Alpha"
- Describe the investment process
- Recall how to manage portfolio and its risk

Content

Part 1 - Pre-reading materials
(i) What is Portfolio Management?
(ii) Fund Management: Will Invest For Food
(iii) David Swensen is Great for Yale. Is He Horrible for Investing?
(iv) Malcolm Gladwell on Nassim Taleb

Part 2 - Presentation Slides of the eCourse

Part 3 - Portfolio Management eCourse*
(i) Introduction
(ii) Section 1: Basics: Valuation of Individual Securities
(iii) Section 2: Risk and Return: The Magic of the Portfolio
(iv) Section 3: Risk Factors and Factor Investing
(v) Section 4: More on Alpha
(vi) Section 5: The Investment Process
(vi) Section 6: Managing the Portfolio and Its Risk
(vii) Section 7: Concluding Remarks

Part 4 - Quiz*
The quiz consists of 15 questions where learners have 3 attempts to achieve at least 80% with correct answers as a pass.

Part 5 - Post-reading materials
(i) The Anatomy of Smart Beta
(ii) Smart Beta Basics
(iii) Has the Yield Curve Predicted the next US Downturn?

* mandatory parts to complete

Who should attend

(1) Hedge Fund professionals seeking to enhance their knowledge
(2) Individuals looking to start a Hedge Fund
(3) Service providers e.g., Banking, Risk, Compliance and IT professionals, Lawyers, Fund Administrators