A market neutral strategy is one where an investor takes a long position and a short position at the same time. There are many ways of implementing this strategy but the basic premise is the same: at any given time some securities are overvalued and others are undervalued. An investor takes advantage of this temporary disequilibrium by buying undervalued securities and taking an equal, short position in a different and overvalued security.

How do we do it?

1. We focus on objective, fundamental analysis of stocks to determine which are overvalued and which are undervalued.
2. We reject the status quo notion that the only way to make money in the stock market is to buy stocks and hold them.
3. We accept the idea, long understood by sophisticated hedge-fund managers, that an equally effective principle is to bet against stocks that are overvalued.

If you could eliminate some of the risk your portfolio faces every day, but still enjoy the benefit of investing in stocks, wouldn’t you? Then Market Neutral Strategy is your answer.

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