Hedge Funds interview preparation

Long-short equity, macro, event-driven, distressed, multi-manager platforms and the Indian Category III landscape. Every question is either traced to a named firm from a public candidate report, or tagged at desk level when we could not trace it — answers lead with the point, then the mechanism, then the limitation.

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Question bank

100 questions, mapped to the firms that asked them

Questions
100
Traced to a firm
39
Firms
16
Updated
September 2026
Asked at
All firmsMan Group10Balyasny Asset Management7Bridgewater Associates3D.E. Shaw3Apollo Global Management2KKR2Oaktree Capital Management2Point722Squarepoint Capital2AQR Capital Management1Baupost Group1Coatue Management1HPS Investment Partners1Northern Trust1Viking Global Investors1Wolverine Trading1
Topic
All topicsStrategy taxonomy8Stock pitch10Short selling6Portfolio construction8Risk and drawdown8Performance and alpha7Event-driven and merger arb8Distressed and credit5Fund structure and economics7Financing, NAV and operations6Compliance and research process5Quant and systematic6India and Category III AIFs5Career and fit11
Level
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Type
AnyTechnicalMarket viewBrainteaserCaseFit
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  1. 027Define gross and net exposure, and tell me what each one tells you.Portfolio constructionCorephone / first roundLong-short equityMulti-manager platforms

    Say this

    Gross is longs plus shorts, net is longs minus shorts, both as a percentage of capital. Net tells you your directional market bet; gross tells you how much stock selection risk you are running. They answer different questions and a good risk conversation uses both.

    Then walk it

    1. Worked example: long 130, short 70. Gross is 200 percent, net is 60 percent. That book has moderate market exposure and a lot of single-name risk.
    2. Net is the beta-ish bet. If the market falls 10 percent and the book is 60 percent net with beta one, you lose roughly 6 percent before any stock selection.
    3. Gross is the alpha bet, and also the accident exposure. Higher gross means more spread if you are right and more pain when factors rotate violently, because both legs can move against you at once.
    4. Beta-adjusted net is the number that actually matters, and saying so is the mark of someone who has looked at a risk report. A book that is 20 percent net with high-beta longs and low-beta shorts can be 40 percent net in beta terms.
    5. Typical ranges to have in your head: fundamental long-short runs 20 to 60 percent net at 150 to 250 gross; a market-neutral pod runs around zero net at 300 to 600 gross with tight factor constraints.
    6. The limitation: neither number captures concentration or factor tilts. A 300 gross book in thirty names with no factor constraint can lose more than a 600 gross book in four hundred names that is factor neutral. Gross without a factor report is a half-measure.

    Where candidates lose it

    Getting the arithmetic right and saying nothing about beta adjustment or what the numbers are for. Every candidate can compute gross and net. The differentiator is saying that beta-adjusted net is the real directional measure and that gross means nothing without a factor decomposition alongside it.

    Expect next

    • What net exposure would you run into a Fed meeting?
    • Can a zero net book lose 5 percent in a day? How?
    • How does gross relate to leverage?

Firm tags come from public, anonymous candidate reports on Wall Street Oasis: strong signal, not sworn testimony. Firms are named as the places a question was reported, not as partners of Fin Maverick. Answers are written for this page to show how to think out loud; they are not scripts to recite.