Credit Suisse Notes Hedge Funds Diversification, Growth

A Credit Suisse report notes that long / short hedge funds have increased their short diversification percentages while funds made cuts to precious metals but additions to base metals while increasing stock market tail hedges.

Hedge funds diversification: U.S. equity long/short book relative to the S&P 500

In considering the diversity of the U.S. equity long/short book relative to the S&P, the charting shows that most recently the short book has climbed to a diversity factor of 220 while the long book diversification fell to 200.

Credit Suisse’s Mark Connors explained this as occurring due to both the long and short books...