MSCI Puts Out Eight Hedge Fund Indices

March 17, 2005 ( - MSCI has launched eight MSCI Hedge Invest Strategy Indices.

An MSCI news release said the latest indices follow the 2003 unveiling of the MSCI Hedge Invest Index, which now has assets of more than $3 billion US linked to it.

According to the announcement, the MSCI Hedge Invest Strategy Indices subdivide the composite MSCI Hedge Invest Index, enabling a more granular investment exposure to the eight trading strategies involved.

The MSCI Hedge Invest Index aims to reflect the overall structure and composition of the hedge fund universe from the funds available on a platform managed by Lyxor Asset Management. The funds on the platform available for the index offer weekly liquidity. The index is rebalanced quarterly and currently contains 120 funds, MSCI said.  

The new indices are:

  • MSCI Hedge Invest Systematic Trading Index– Systematic traders use rule-based trading models implemented in a systematic fashion to identify trading opportunities, usually in the futures and currency markets.
  • MSCI Hedge Invest Discretionary Trading Index– Discretionary traders seek to opportunistically participate in price changes of the market or security in which they trade, regardless of what is driving the price action.
  • MSCI Hedge Invest Long Bias Index– Long Bias portfolios have net long exposure to the underlying market in all conditions.
  • MSCI Hedge Invest Variable Bias Index– Variable Bias funds do not conform to a constant specific long or short market exposure, but are still focused on individual security selection.
  • MSCI Hedge Invest Equity Non-Directional Index– Equity Non-Directional combines managers employing a No Bias process and managers employing Statistical Arbitrage process.
  • MSCI Hedge Invest Convertible and Equity Arbitrage Index– Convertible Arbitrage typically involves taking positions in convertible bonds and hedging either the equity or credit risk or both.
  • MSCI Hedge Invest Event-Driven and Merger Arbitrage Index– Event-Driven encompasses a combination of investment processes targeting securities that experience a change in valuation due to corporate transactions. In general, the triggers are announced corporate events and may include mergers and acquisitions, bankruptcy announcements, proxy battles, corporate restructurings, spinoffs, litigation outcomes, leveraged buyouts, share buybacks and leveraged recapitalizations.
  • MSCI Hedge Invest Fixed Income Index –Fixed Income contains hedge funds that target a range of strategies with a fixed income asset class focus.

More information is at .