Visual Guide to Hedge Funds

CHAPTER 8 Fixed-Income Strategy

A fixed income hedge fund strategy is one where the investment manager focuses his attention on fixed-income products that range from sovereign bonds to distressed debt. The fundamental aspect of a fixed-income product is that it is a debt security where the issuer must repay the debt as well as a fixed coupon rate to compensate the buyer of the product. The coupon is the fixed-interest rate on the security and thus provides an income component to the holder of a fixed-income product.

DEFINITION:

Fixed Income

A fixed-income strategy entails investing in an asset class where the investor is entitled to a fixed amount on a preset schedule.

Fixed-income assets are typically issued by a corporation or government, ...