Hedge fund investors are warming up to long-short equity.

We saw the first hint of this growing trend back in late fall when a Preqin survey of institutional investors found that 38 percent of responders were seeking long-short equity investments, making it the most popular strategy. “The strategy’s continued popularity is due to its ability to provide a level of protection in falling markets while capturing the majority of the upside in rising markets,” the London-based expert on alternative investments noted in its report at the time.

This sentiment was further confirmed earlier this week in a 30-page report published by PerTrac, a provider of software for investment professionals, which found that long-short equity is the most popular strategy pursued by Alternative UCITS (Undertakings for Collective Investment in Transferable Securities) funds. Alternative UCITS funds are those fast-growing, pan-European investment vehicles that pursue hedge-fund-like strategies but with limited leverage and illiquid assets.  ....

Read More: hedge funds · investment strategy