A Long-Short Fund is a type of investment fund which can both go long (i.e. buy) and go short (i.e. sell-short). Typically Long-Short Funds will stick to a constant ratio of long to short positions; some funds will take a market neutral strategy by combining equal and offsetting long and short positions, while others may use a smaller amount of short positions e.g. in the case of a 130/30 fund which is long 130% of the portfolio and short 30%. Long-Short strategies are common among hedge funds and absolute return funds. The contrasting, or opposite type of fund is a long-only fund, which will only go long, or buy stocks.
Similar Fund Terms: Market neutral fund, 130/30 fund, Absolute return strategies, Hedge fund
If you have any further questions or would like to add to this fund management term, then please submit your thoughts below.
Fund Management Terminology and Concepts Explained: www.fundterms.com