Hedge Funds case studies, worked step by step

Cases
100
Traced to a firm
31
Topics
13
Hard
30
Topic
All topicsCredit, distressed and capital structure7Earnings, models and KPIs8Event-driven and merger arbitrage7Fund economics, NAV and LP decisions8Global macro trades7Long pitches and valuation14Manager evaluation and attribution7Pairs and relative value5Portfolio construction and sizing7Risk limits and drawdowns7Short selling6Systematic research and data11Volatility, options and convertibles6
Level
AnyWarm upCoreHard
Source
AnyReported at a firmStandard
Showing 91–100 of 100
  1. 091The Cendra Absolute Return Fund manages Rs 2,000 crore. Investors ask to redeem 30%, but a 20% quarterly gate applies. 60% of the book can be sold in five days and the rest takes a month. How do you meet the redemptions, and what does the gate protect?Fund economics, NAV and LP decisionsCoreFund of funds and allocators
  2. 092Calderra's 10-year nominal bond yields 7.0% and its inflation-linked bond 2.5%. You expect inflation to average 5%. What is breakeven inflation, what trade expresses your view, and what do you make if inflation averages 5.5%?Global macro tradesCoreGlobal macro funds
  3. 093Dinsha Jewellers grows revenue 20% a year from Rs 5,000 crore at an 8% EBIT margin, but holds 200 days of inventory, so each rupee of new revenue ties up working capital. Is the growth creating value? Compare the ROIC on incremental capital with a 12% cost of capital and a 25% tax rate, measuring inventory days on revenue.Long pitches and valuationCoreLong-short equity fundsMulti-manager platforms
  4. 094Dhanvi Diagnostics grew revenue 30% a year for three years: 12 points organic and 18 points from acquisitions bought at 12x EBITDA with debt, while the stock trades at 25x. How much of shareholders' return came from M&A rather than the core business, and how would you judge the quality of that growth?Manager evaluation and attributionHardViking Global InvestorsNew York · 2025
  5. 095Zorvek Defence has no listed peer. Its returns regress on the market with a beta of 0.9 and on a capital goods basket with a beta of 0.6, with an R-squared of 45%. You are long Rs 20 crore. How do you hedge it, and how much risk is left?Portfolio construction and sizingHardBalyasny Asset ManagementNew York · 2026
  6. 096Birkan Capital's book is 20% net long Indian banks and 10% net short IT services. Run a stress scenario in which the rupee falls 8% and rates rise 100 basis points, using bank sensitivities of minus 1.5% per 10 basis points and IT sensitivities of plus 0.8% per 1% rupee fall. What does the book lose and which hedge helps most?Risk limits and drawdownsHardMulti-manager platforms
  7. 097The Qadira value backtest uses book value from annual reports dated to the fiscal year-end, although reports appear about 60 days later. The backtest earns 11% a year. What bias is this, how does it inflate returns, and how do you fix it?Systematic research and dataCoreQuant and systematic funds
  8. 098Prysmic Solar's convertible bond trades at 105 with a conversion ratio of 10 shares per 100 face, the stock at Rs 9, and a delta of 0.6. How many shares do you short per bond to hedge, and what do you make or lose if the stock moves 10% either way?Volatility, options and convertiblesHardVolatility and relative value funds
  9. 099Varuni Retail earns a 25% ROIC, reinvests 60% of earnings and trades at 40x. Ostrel Metals earns an 8% ROIC, pays out everything and trades at 8x. Over ten years both multiples converge to 15x. Which stock returns more, and how sensitive is the answer to the exit multiple?Long pitches and valuationHardCoatue ManagementNew York · 2023
  10. 100Build a value factor on the Trivan universe of 12 stocks across three sectors: rank on book to price, go long the top three and short the bottom three. Then build it sector-neutral. The two versions give different returns. Why, and which would you use?Systematic research and dataHardAQR Capital ManagementNew York · 2021

Company names and figures are illustrative.