How does a hedge fund hedge in Thailand?

Thai equities specialist Quest discusses how to manage risk when few hedging instruments exist.

Quest Capital is a Thai equities hedge fund with $160 million of assets under management. Its president, Doug Barnett, and portfolio manager Lance Depew met with FinanceAsia to explain how an alternative investment strategy works in Thailand.

FinanceAsia How do you hedge in a market with no derivatives exchange

Barnett We hedge with cash, which is what makes us not a mutual fund. Thailand-focused mutual funds must be diversified and follow prudent-man rules. We, however, take very concentrated positions. Right now we've got 30% in cash, and 20% of the portfolio is in one stock, and 12% in another.

Why do...

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