Question

The difference between market-neutral and long-short hedges is that market-neutral hedge funds _________. establish long and short positions on both sides of the market to eliminate risk and to benefit from security asset mispricing whereas long-short hedges establish positions only on one side of the market allocate money to several other funds while long-short funds do not invest in relatively stable proportions of stocks and bonds while the proportions may vary dramatically for long-short funds invest only in equities and bonds while long-short funds use only derivatives

Answer 1

The difference of the two is that the market neutral hedge has the capability of establishing short and long positions in regards of the market’s both side in means of eliminating the risk and in the same time, it produces a benefit that could be obtained from the security asset mispricing where the long and short hedges only establish positions on the market’s one side.