You are reading this book because of your interest in hedge funds: you want to work in one, maybe establish a new one; or you want to regulate them, write about them, perhaps even abolish them. In any case, you need to understand what they are and how they do what they do.
In this book we strive to present the essential concepts for quantitative fund management. We need to make some assumptions about our audience in order to frame our presentation. So we will assume you want to manage a fund, and we’ll get you started on the basics from that viewpoint. We will also focus on stocks in the U.S. markets.
Let’s first start with some context. What is investing, and how does that relate to stocks?