Explanation:
Correct Answer is B
Global macro funds utilize highly active asset allocation strategies to bet on wide-ranging macroeconomic events. They take positions in varied risk factors such as equity, fixed income, currencies, and commodities globally. Because of their broad mandate to invest across different asset classes and geographies, global macro funds often exhibit a return profile that resembles a diversified portfolio of hedge funds.
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Q.8 A fund manager has recently started his own hedge fund. The fund’s investors demand that the fund’s return must resemble that of a diversified hedge fund portfolio and should adopt a highly active asset allocation strategy betting on a diverse range of risk factors.
Which of the following is the most suitable hedge fund style for this manager?
A
Managed futures
B
Global macro
C
Merger arbitrage
D
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