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CFA Level 1
Alternative Investments

Identifying Hedge Fund Strategies

Medium Types Of Alt Investments Hedge Funds

Hedge funds are a popular alternative investment vehicle that seek to generate high returns using various investment strategies. They often utilize a wide array of techniques, including leverage, short selling, and derivatives. However, hedge funds can vary significantly in their approach and risk profile.

Which of the following best describes a hedge fund strategy that aims to profit from the difference in price between related financial instruments?

Hint

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