A hedge fund manager engages in a relative value trade. She takes a long position on GM

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A hedge fund manager engages in a relative value trade. She takes a long position on GM Holden and a short position on Ford.

Why is this trade a 'market neutral' strategy?

ABC company announces that it will acquire XYZ company. Based on this event, outline a relative value trade that a hedge fund manager could employ to profit the fund.

What is the rationale behind the trade?

Related Book For answer-question

Investment Analysis and Portfolio Management

ISBN: 978-0538482387

10th Edition

Authors: Frank K. Reilly, Keith C. Brown

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Posted Date: Mar 18, 2023 08:53 AM

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A hedge fund manager engages in a relative value trade. She takes a long position on GM

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Investment Analysis and Portfolio Management

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