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Facebook offers so many ways to reach prospects in unique and cost-effective ways, not the least of which is remarketing! The great thing about Facebook remarketing is that it is so incredibly versatile.
Nearly any company can find a way to re-engage their prospects through remarketing, even if they don’t view Facebook as their personas’ primary watering hole.
There are some great ways to narrow focus and the inventory is often inexpensive. Not to mention, Facebook’s bidding algorithms arguably rival some of the best in the PPC landscape.
What that means is – even if you don’t leverage Facebook for prospecting campaigns, there’s probably still low-hanging fruit for you in remarketing.
Let’s talk about some of the ways you can leverage Facebook to reach your target audience.1. Remarketing Page Visitors
The easiest and most obvious remarketing strategy is to create remarketing lists from page visitors.
Sometimes, if you have a small audience, starting out by remarketing all visitors is best. This is because additional segmentation may make the lists too small to get out of the learning phase.
If your audience is big enough, though, it’s ideal to create audiences based upon visits to pages that indicate intent – such as people that visited a page to sign up for a free trial or request a demo but then didn’t complete the request.Creating Audiences From URL Parameters
To take page visitor remarketing one step further, you can create audiences off of any part of the URL string, even if it isn’t part of the page.
Put simply: you can create audiences off of URL parameters, as well as subfolders.
This can be handy if you want to remarket visitors of a specific source separate from your other audiences.
For example, if you were running a campaign in Linkedin targeting specific Linkedin groups or skills, you might decide to use Facebook as an additional remarketing source as it is often more cost-efficient.
You could then use your UTM tags to create an audience of only folks from just that specific campaign.Visitors by Time Spent
You can further segment your URL-driven audiences by selecting to segment them by time spent. You could target people by the top 25%, top 10%, or top 5% of time spent, for example.
This can be a useful way to try to zero in on folks with the highest engagement.2. Remarketing Conversion Events
If remarketing page views don’t allow you to build the audience that you need, Facebook also offers the ability to build audiences off of the events that you’ve created for conversion tracking.
This can be handy both for targeting your audience to get them to the next stage in the funnel.
It’s also helpful for exclusions, to ensure that you aren’t targeting people that have already taken a certain action – even if Facebook wasn’t the source that drove the action.3. Remarketing Your Offline Activities
Facebook also makes it easy to remarket offline activities, which is really cool! There are two ways you can do this: through audience lists and offline events.
Let’s delve into each!Uploading Audience Lists
One of the most well-known ways to remarket offline activities is to upload user lists.
There are a ton of different ways you can segment this data.Remarketing Offline Events
You can also remarket people from your offline event sets if you’re tracking offline events.
So if you’re importing events for text messages, for instance, you can remarket them to get them to the next stage in the funnel – maybe to let them know of a sale on certain products.
If you have access to store visit tracking and have at least 10 measurable stores set up, you also have the ability to create audiences off of store visits – which opens up a wealth of opportunities for brick & mortar.4. Remarketing On-Facebook Activities
You also have the option to remarket Facebook engagement, which presents a whole host of ways that you can engage and re-engage your audience as they move through the customer journey.Remarketing Engagement on Facebook or Instagram
One super-easy way to create audiences from engagement is to remarket people that have engaged with your brand on Facebook or Instagram.
Unfortunately, you can’t select a specific post (though there are ways to be a little more specific with the categories below) but you can choose to remarket:
People that have engaged with your content.
People that have visited your page.
People that sent you a message.
People that saved your page or posts.
Everyone that engaged with your page (which would include all of the above).Video View Remarketing
One way that you can zero in on your engagement audiences is by remarketing video views.
With video view remarketing, you can’t technically pick the exact post but you can choose to create audiences off of only specific videos or all videos.
You can determine if the video views need to be 3 seconds, 10 seconds, 15 seconds (or thru-play if less than 15s). Alternatively, you can select to target people that watched at least 20%, 50%, 75%, or 90% of the video.
So for example, you might leverage a higher funnel campaign promoting videos and then you could remarket people that watched at least 50% of the video.Remarketing Lead Gen Forms
With lead generation form remarketing, you can remarket people that opened a form, opened but didn’t submit the form, or people that opened and submitted a form. You can choose which form(s) that you want to build the list off of.
If someone filled out a lead gen form for a piece of content and you wanted to remarket them to get them to the demo, for example, you could build and remarket an audience of form submissions for that piece of content.
Or, if you were testing two different forms for the same action, you would want to exclude submissions of the other form in the test so that you didn’t pay for or receive unnecessary visibility from people that have already submitted the form.
Or, if you wanted to remarket people that opened the form but didn’t submit it, you could do that, too.
Since the form doesn’t automatically open, people that have opened the form are showing intent signals.5. People Who Engaged With Your Events
If you create events on Facebook, you have a lot of remarketing options.
You can remarket people that have:
Responded that they are planning to go.
A stated interested in attending.
Visited or engaged with the event (even if they didn’t RSVP).
Begun to purchase tickets but abandoned the purchase process.
Completed the process to purchase tickets.
For example, if you decided to host another event in the future, you may want to remarket people that RSVP’d or only people who purchased tickets.
Or you may want to create such lists and use them as the seed for lookalikes!6. Remarketing Instant Experiences & Your Facebook Shop
I’m grouping some options together here but if you’re an ecommerce, you have a ton of different in-platform remarketing options.
For example, if you have a Facebook shop, you can remarket people that:
Viewed your shop.
Added to cart.
And more.7. Test Layering Qualifiers If You Have a Niche Audience And/Or Find Remarketing Isn’t Converting Well
If you have a really niche audience and you find that remarketing isn’t working well, you can also test layering other interests and demographics to better qualify your list.
You may need to do this for a host of reasons. For example, if you recently added a new high funnel traffic source to your website that doesn’t seem to be performing, it can junk up your audiences as you’ll now be remarketing that low-quality traffic (sigh).
Adding interest or demographic qualifiers can help clean up your audience list to zero it back in on the right folks.
Keep in mind that doing this will shrink the size of your audience quite a bit. You have to really consider whether it makes sense for you. Read: Can you get out of the learning phase with an audience of this size?8. Dynamic Remarketing
Using the catalog objective, you can configure some really cool remarketing campaigns. There are so many options.
The most popular format is remarketing to people that viewed your products and didn’t purchase, sending an ad to follow folks around with the exact products they appeared interested in.
You can further qualify those folks by only targeting people that added to cart and didn’t complete the purchase.
Or, you could target folks that purchased but add an exclusion for a certain length of time – say, targeting people that purchased 30 days ago but haven’t come back to purchase since then.
This is especially valuable for businesses that are selling products that drive a lot of repeat purchases (think products that get used up). You can filter which products you do or don’t want to include in your product set.
If you are a shoe company that also sells shoelaces, for example, you probably don’t want to remarket people that were looking at laces as it would be hard to get a good ROAS on that.
You may also want to create different ad sets for different types of shoes so that you could make sure the ad copy was really relevant. If someone was looking at tennis shoes and dress shoes, you could create ad copy that really drove the value of each without having to be too generic.
But if your audiences are small, you could keep them grouped together to pull all the data together.Dynamic Up-Selling & Cross-Selling
The catalog objective is also excellent for up-selling and cross-selling. So you could target people that purchased specific things with accessories or other items that they may like!
For example, one of my clients sells a popular food product. We remarket recent purchasers with their cookbook if they didn’t buy it when they initially purchased the food product.9. Recency Based Lists – If You Have Enough Data
If you have enough data to segment it further, you further segment your audiences by recency.
Think about it – if you visited a store and added a pair of shoes to your cart but forgot to check out, you’re likely way more likely to complete the transaction in the next day or next few days if you are reminded vs. if you are reminded 30 days later.
By 30 days later, you may have changed your mind or bought something else.
Heck, if you were buying the shoes for an event, it may even have already passed.
As with all audience segmentation, you have to be careful that extra filters don’t make the audience too small to drive meaningful data collection.10. Creating Audiences Off of App Activity
If you have an app, you can create audiences based upon your app user base.
You can create audiences off of anyone who opened the app, your most active users, users by purchase amount, and users by segment.
You can also target app events but keep in mind your app needs to be measuring app events to create a Custom Audience from it. The app events your app is set up to measure for will automatically populate in the drop-down menu.11. Audience Sharing
Facebook also offers the ability to share audiences with partners. There are a couple of different instances where this makes sense.
For one, sometimes it makes sense for sister companies to share audiences (if they are targeting similar personas).
And two, if you’re working with partners to cross-promote, you can also share audiences between business managers so that you can each target each other’s audiences.
The additional perk of sharing audiences in the case of custom audiences is that the business sharing the list can upload any email addresses into their own business manager and then share it to partners without ever sharing the actual email addresses themselves.12. Follow Your Buyer Journey
Remarketing is a great way to support your funnel. You know exactly what actions folks have taken, what pages they’ve visited – so you can track those actions and remarket them with the next step to continue moving them forward.
Your customer journey could be multiple steps with multiple remarketing audiences moving things forward (and always excluding lower-funnel audiences from higher funnel ad sets to keep things moving in the right direction) or it could be just a few steps.
Even if your buyer journey isn’t that long, you can take a look at your journey to see where people are dropping out and then use remarketing to bring them back.
For instance, remarketing people that add-to-cart but don’t complete their purchase or people that sign up for a demo but then don’t attend, and so on.13. Planning Your Lists Around Other Marketing Activities
Another cool way to use remarketing lists is to help plan your campaigns around other marketing activities – typically email.
Let’s say before you do that, you take a look at the bigger picture of other marketing opportunities and you see that email with a cross-sell or up-sell opportunity is automatically sent post-purchase 24 hours after the sale.
Your company has already paid for the email marketing platform so it would be silly to try to get sales through PPC that you could have gotten through email.
This doesn’t have to only be used for cross-sell/up-sell, this can be used for any part of the funnel where email has automated triggers in place, including emails following micro-conversions.14. Try Testing Different Campaign Objectives
It can also be worth testing different objectives with remarketing. Often, people lean toward conversion remarketing but, as I mentioned above, it absolutely makes sense to test the catalogue objective if you are an e-commerce, as it often will perform even better.
It also makes sense to test the lead gen objective if you are set up to be able to accept lead gen submissions through Facebook or if you want to drive calls!
Even beyond that, though, because remarketing lists are often very warm, it can make sense to test awareness, reach, traffic, and even video view campaigns to see if you can get to a lower cost of acquisition because the CPMs are typically cheaper.
Facebook’s bidding algorithm is getting better and better all the time, so it may not beat your conversion-objective campaign — but it is worth a test.
Image credits: Paulo Bobita
You're reading 14 Facebook Remarketing Strategies To Test
The new pro-consumer privacy measures Apple implemented with the launch of iOS 14 brought major changes to the digital marketing world.
The Facebook iOS 14 update also shook up the paid social realm.
And since the announcement, no company has been more vocal about the potential implications to its platform than Facebook.
In fact, for many, it wasn’t a big leap to think the update was the beginning of the end of the world – tracking-wise.
But after months of preparing clients with training, documentation, decks, POVs, and webinars, the moment came.
April 26th was D-Day. Facebook’s new policies to mitigate tracking loss became mandatory. And, so it began.
In this column, you’ll learn about these challenges and what you can do about each one:
Pixel-Based Conversion Reporting Is Off… Way Off
Conversion Rates Are Inconsistent
Campaign Budget Optimization Is Less Reliable
Retargeting Audiences Are Smaller: No Surprise ThereOpting In vs. Opting Out
The main issue surrounding iOS 14 was the use of Apple’s Identifier for Advertisers (IDFA), Apple’s cookie that allows tracking on iOS devices.
Until implementation, Apple device owners were automatically opted-in for tracking but had the option to opt-out.
Now, following the update to iOS 14.5, iOS users are prompted and asked if they would like to be opted into being tracked, with the default now being opt-out.
According to mobile analytics company Flurry, when iOS 14.5 prompts began, an estimated 2% of users opted-in to tracking. That number has steadily increased since the end of April but even now only sits at an estimated 10%.How the Facebook iOS 14 Update Impacts Marketers
Depending on your perspective, iOS 14 is a win for consumer privacy. But there’s no question it’s a big, fat loss for digital marketers.
Delayed reporting for pixel-based conversions.
Conversion modeling/estimated results.
Shorter attribution windows.
Conversion prioritization (aggregated event measurement).
Smaller retargeting audiences.
Fewer data breakdown options.What We’ve Seen So Far
Now that we’ve been living in this brave new era of reduced mobile tracking ability on Facebook for the past few weeks, let’s take a moment to examine the impact.
Was this truly the apocalyptic event many had feared? Or was it something more akin to a Y2K-level false alarm?
The answer is, as is generally the case, somewhere in the middle. There have been some appreciable impacts on campaigns, especially if your campaigns heavily depend on pixel-based conversions.
But has iOS 14 made Facebook a less viable channel for demand generation marketing?
Hardly.1. Pixel-Based Conversion Reporting Is Off… Way Off
Between fewer tracked mobile conversions, delays in reporting, and a healthy dose of “statistical modeling” on behalf of Facebook, it’s no surprise the numbers you may be seeing in Ads Manager aren’t necessarily reflective of reality.
Though the ratio variance is inconsistent, it seems to be growing.
What You Can Do:
Implement Conversions API and optimize campaigns to back-end events.
Use On-Facebook lead generation tactics such as forms or messenger for more reliable results.2. Conversion Rates Are Inconsistent
Perhaps one of the biggest and most frustrating impacts we’re noticing post-implementation is the lackluster performance of evergreen campaigns. Sure, a degree of performance falloff is expected as complex algorithms adjust to the new tracking realities.
But after a few weeks of rising CPLs and more data becoming available, we started to see some root causes emerge – unpredictable conversion rates.
What used to be relatively minor week-to-week changes gave way to significant swings.
With unpredictable lead conversion rates, CPLs were equally volatile as Facebook struggled to optimize ad sets driving the best results.
What You Can Do:
Diversify targeting: Aggressively test a broad range of interest-based, lookalike, and third-party audiences.
Keep a close eye on interest-based audiences, as those appear to have the most fluctuation.3. Campaign Budget Optimization Is Less Reliable
CBO, or Campaign Budget Optimization, is a tool that allows Facebook to allocate budget among ad sets based on performance dynamically. The better-performing audiences based on your objective tend to get a larger share of your daily budget.
Budgets are set at the campaign level instead of the ad set level.
This once-powerful tool for maximizing efficient distribution of spend is showing its vulnerability in light of the recent tracking changes.
Several client campaigns with CBO enabled showed Facebook allocating a disproportionate amount of spend towards interest-based audiences with much higher CPLs, even when similarly-sized audiences with lower CPLs were available.
This is a curious case, prompting more manual intervention and allocation of spend across various audience segments.
What You Can Do:
Consider the use of automated rules as a “backstop” to prevent Facebook from overspending on poor-performing ad sets.
With campaigns with CBO enabled and multiple audiences, set a CPL threshold that’s slightly higher than your goal.
Then, set a daily spend amount you’re comfortable spending on a given audience.
Set the rule to pause an audience if it has spent that amount and driven CPLs higher than your threshold.
Don’t forget to set a rule to unpause all ad sets at the beginning of a new day.
4. Retargeting Audiences Are Smaller: No Surprise There
The last impact is merely a confirmation of what we all knew was going to happen. Pixel-based retargeting audiences are smaller and harder to reach.
Since we just lost tracking on a large percentage of mobile traffic, retargeting based on user-visited websites will become a less viable tactic as people age out of the website custom audiences they’re currently in.
Any website custom audiences created during or after the iOS 14 implementation and where that period of time is within the look-back window has undoubtedly seen a reduction in the number of targetable people within those audiences.
What You Can Do:
Leverage alternative retargeting data sources, such as:
First-party data (Custom audiences based on emails/phone numbers, etc.).
Video-based retargeting (People who have watched a certain percentage of your pages video ad content).Facebook iOS 14 Update: The Aftermath
When it comes to iOS 14 and Facebook, it’s safe to say the worst of the storm is over. Marketers also know much more about what to expect as the cookieless future becomes more real.
Tactics evolve, as they always do. And marketers will adapt to the changing landscape.
The Facebook iOS 14 update is the cautionary dress rehearsal for the impending elimination of third-party cookies from browsers like Chrome. At least, we’ll have until 2023 to get ready for that one.
If you want to test your typing speed, check out these free online tools. You can test your typing skill with these tools. The best thing is that some of the tools help you learn the 10-finger typing method to ennoble your typing skill.Best free online tools to test typing speed
Here are the best free online tools to test typing speed-
Let’s check out these tools in detail.1] LiveChat
It is one of the good-looking websites where you can test your typing speed. The user interface of the LiveChat official website is uncluttered, and that makes it better than others. Although it has almost all the essential features, there are two drawbacks.
First, it doesn’t allow you to change the time limit. Second, it doesn’t test your typing skill with the proper sentence. In other words, you will have to type random words. However, you will get the words/min, characters/min, and percentage of accuracy as you type. After the end of the given time, you will see the formal report you can share with friends on various social networking sites.
TIP: These free Typing Software for Windows 10 are sure to interest you.2] TypingAcademy
TypingAcademy doesn’t restrict users to a one-minute time frame as you will have two minutes to test your skill. It shows various information such as error rate, words/min, characters/min, signs, last key, etc.
Unlike LiveChat, it offers proper sentences to type so that users get a real-life experience while typing. The UI is neat and clean, and that’s why you won’t find any problem even for the very first time. It doesn’t require creating an account, but account holders can save their progress. Check out the official website to test your skill.3] TypingCat
The best thing about this website is that you can set a maximum of 5 minutes to test your typing speed. It shows original sentences so that you can start your typing quickly. Talking about the information, the official website of TypingCat displays accuracy level, word count/minute, character count/minute, error rate, etc.
Another important thing is that you can see the top rank holders of the last 24 hours and all-time on your right-hand side. It helps you improve as you practice and test your skill.4] TypingTest
TypingTest is a fully-featured website to test your typing skill online. Although other websites allow you to select only English, you can choose other foreign languages on this website. The second essential feature is that you can choose an essay from the given list.5] 10FastFingers
Although 10FastFingers is a free website, it comes with tons of essential options and features. From a regular typing test to multiplayer competition, you can do everything on this website. The next big thing is that you can enter custom text to test the skill as per your requirements.
Even though this website doesn’t require an account to access all the features, you can save your progress with an account. Apart from that, you can enlist yourself in various competitions and games with a user account. The next important option is that you will have the opportunity to choose among multiple languages, including English, Danish, Spanish, Russian, French, etc.
Although it doesn’t show the characters/min or some other minor details, you will find the word per minute count and the accuracy level. The second feature is that you can select a 1-minute test and a 3- and 5-minute test. The third feature is that you can take a page test on this website.
Apart from these, it records all the reports by date to find the improvement quickly. The only setback of this website is the font of the text. As it uses the monospace font, it isn’t enjoyable to look at it as you type. Check out the website to take a test.7] Ratatype
If you do not want to get some fancy features, Ratatype is probably the best option for you. The clean UI makes it better for newbies. It shows minimal information, such as accuracy percentage and word per minute count. However, it has a unique feature. You won’t find a time limit while taking a test. It shows the typing speed or the word count/minute, and the accuracy level as you start typing.
This website offers a typing tutor that helps you learn fast typing with the 10-finger method. The last but not the least feature is that it allows you to choose among various languages to test your skill in different languages simultaneously. Check out the official website for more information.
That’s all! These are some of the best online tools to test typing speed.
About Valentines Day
A Day to celebrate love, a day to celebrate affection, and day-to-day I LOVE YOU to the love of your life – Valentines Day is an official holiday for lovers. This day is beyond the exchange of gifts and greetings. Thanks to St. Valentine, who marked the Day of lovers with a promise to be more expressive and affectionate between friends and relatives. Every February 14th, people celebrate Valentines Day, also known as St. Valentines Day. Claudius II Gothicus, the Roman emperor, martyred a priest in 270 CE, and named several Christian martyrs Valentines. People named this day after the priest.Significance of Valentines Day
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Here are some quick facts about Valentines Day:
This day is also linked with the Roman festival of Lupercalia. This is also celebrated in mid-February with Valentines Day.
Earlier, people celebrated the Lupercalia at the onset of the spring season, and they paired off women with men and performed fertility rites by forming a lottery.
Pope Gelasius banned the celebration of Lupercalia and replaced it with Valentines Day.History of Valentines Day
People celebrate this holiday every February 14th annually to commemorate the day of affection, love, and care.
It is usually between intimate companions, but many people celebrate their relationships with friends, relatives, and family.
The history of Valentines Day is not well documented, but we have several stories, legends, and myths associated with the romantic day.
The two of the most popular theories are as follows:# Theory 1
One such popular theory is the festival of Lupercalia- the fertility festival dedicated to Faunus. Faunus was the Roman god of agriculture and the founder of Romulus and Remus.
In this festival, men and women used to participate, wherein the former drew ladies’ names. The draw determined the pairing, and sometimes, men stay single throughout the year.# Theory 2
People also say that Saint Valentine originated on Valentines Day. He was a catholic priest who lived in the 3rd century.
Saint Valentine defined the Roman emperor’s ban on marriage. He also performed secret marriages for young lovers and promoted love within.
The court executed Saint Valentine on February 14 after they caught him. His sacrifice didn’t go vague. The day is still celebrated and honored in the world.How to Celebrate Feb 14?
Some popular ideas include:
Sending cards or gifts: Express your love and affection by sending a small gift to your significant other. You could also send a message or a virtual gift if you are apart.
Go on a date: Plan a special outing, such as a movie, a concert, or a museum visit. You could also go on a scenic drive, walk in the park, or visit a local attraction.
Plan a romantic dinner: Cook a special meal at home or go to a restaurant for a romantic dinner. Light candles, play soft music, and enjoy each other’s company.
Have a spa day: Treat your loved one to a relaxing spa day with massages, facials, or other spa treatments.
Write love letters: Write a love letter or create a special scrapbook to show your love and appreciation.
Give flowers or chocolates: Give your loved one a bouquet or a box of chocolates to show your affection.
Plan a surprise: Plan a special surprise for your loved one, such as a weekend getaway, a hot air balloon ride, or a scenic hike.
Remember, the most important thing is to spend quality time with your loved one and express your love and affection meaningfully.Celebrate the Day with Friends and Family
Host a dinner party: Invite friends and family for a potluck dinner or barbecue. Decorate the table with hearts and flowers and enjoy each other’s company.
Plan a group outing: Organize a group outing, such as a movie, a concert, or a museum visit. You could also plan a picnic, a hike, or a game night.
Have a movie night: Have a movie night at home and watch romantic comedies, dramas, or action films together.
Go on a road trip: Plan a trip to a nearby destination and enjoy a fun-filled day together.
Valentines Day is not just for romantic partners. It’s a day to celebrate love and affection with friends and family!
Introduction to Hedge Fund Strategies Managers
A hedge fund is an investment partnership between the fund manager (called the general partner) and investors in the hedge fund (called limited partners). Hedge funds strategies can carry a huge investment risk, and chasing the bull market or following a herd mentality can get you financially trampled. Plunging cash into a high-performing fund without doing your homework can result in a poor grade at the end of the trading session. So, here’s your financial market survival toolkit with handy tips to guide you through the ins and outs of hedge fund strategies.
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Download Corporate Valuation, Investment Banking, Accounting, CFA Calculator & othersMeaning of a Hedge Fund Strategies Managers
A hedge fund is a term for investments made by limited partners who contribute money which the general partner then manages.
The hedge fund definition operates on one key principle: Maximize returns and minimize risks. Hence one refers to it as “hedge” fund management.History of Hedge Fund Strategies Structure of a Hedge Fund Strategies Hedge Fund vs. Mutual Funds
A hedge fund strategies have certain points in common with a mutual fund, which are as follows:
Both are pooled investment vehicles.
You can use either to invest in securities such as equities, options, and bonds.General/Limited Partnership Model
The typical hedge fund strategy structure is two-tier, comprising the general/limited partnership model.
Within this structure, the funds are operated by the general partner, and there should be a minimum of one limited partner who makes investments and has limited liability/liability for paid-in money.
Such a partnership can have multiple general and limited partners. However, some SEC rules limit the number of investors barred from registration.
A typical partnership structure is a limited liability company, or LLC, called so because it is a flow-through tax unit, and investors can be held in limited liability equalling their investment amount.
General partner markets and manages the funds, including hiring a fund manager and administrating fund operations.One Partner or Many? Hedge Funds take the High Road and Mutual Funds the Low
The fee structure is one of the chief points of difference between Hedge Funds vs Mutual Funds. Mutual Funds involve lower fees, while fees paid by investors in the case of hedge funds strategies are higher and include additional fees not charged by an MF.Hedge Fund: Term Structure
Terms offered by each fund are unique, making it a tangible point of difference. Terms are linked to the following factors:
Subscriptions and redemptionsLock-Ups
Some funds require a lock-up commitment which can either be a hard lock (preventing withdrawal of funds by an investor for a full-time period) or a soft lock (fund withdrawal is possible following payment of a penalty ranging from 2 to 10%).Distinctive Features of Hedge Fund Strategies
Riskier: Hedge fund strategies are riskier than traditional mutual fund investments. This is because hedge fund strategies do not have to report their underlying positions to any regulatory agency or members of the public.
Seeing is Believing: The Need for Transparency
Investors have demanded more transparency from hedge fund strategies, even though top hedge fund managers do not want to show their cards and reveal their position.Below are the Important Hedge Fund Strategies Equity Market Neutral
In this hedge fund strategy, funds identify (or at least try to) over and undervalued equity securities. At the same time, there is the neutralization of portfolio exposure to market risk through a combination of short and long positions.
Portfolios are neutral with respect to market, sector, industry, and currency/dollar and have a portfolio beta of 0 value.
How is this ensured? The long and short positions are held with equal potential for related market or sector factors.
The thumb rule: Overvaluation is slower to correct than undervaluation.
Reason: Many investors face limitations pertaining to shorting of stocks.Benefiting from Mis Pricing: Convertible Arbitrage
These hedge fund strategies can help capitalists with mispricing in convertible securities, such as convertible bonds, warrants, and preferred stock.
Managers buy/sell a security and hedge part/all of the risks linked to it.
Example: Buying a convertible bond and shorting the associated stock to lower risk.Fixed Income Arbitrage: Over and Undervalued Bonds Important
Here, the funds seek to identify over as well as undervalued bonds on the basis of expected changes in term structure and credit quality of issues/market sectors.
One neutralizes this type of portfolio against directional market movements through a combination of long and short positions.Profit in the Face of Default: Distressed Securities
Portfolios of distressed securities are invested in the debt and equity of companies facing or undergoing liquidation.
Traditional investors prefer to transfer risks when there is a danger of default. Thus, funds are held long in an account of the non-liquidity of distressed debt and equity, making shorting difficult.Catching the Price Spread: Merger/Deal Arbitrage
This type of hedge fund strategy can capture the price spread between the current prices of the securities and their expected value following a positive event such as a takeover, M&A, spinoff, or more associated with multiple hedge fund companies.
Merger arbitrage involves purchasing the target firm’s stock, following a merger announcement, and shorting the revenant mount of the acquirer’s stocks.
Merger arbitrage derives a return from news of acquisitions and mergers.
A deal is subject to the following conditions:
A positive vote by target company shareholdersNon-Neutral Portfolios: Hedged/Long-Short Equity
This hedge fund example aims to identify over as well as undervalued securities, thereby dealing in highly concentrated, typically non-neutral portfolios. The value of the short position may be a fraction of the long, and the portfolio may have a net exposure to the equity market in the long term.
The first hedge fund in financial history, launched by A.W. Jones in the late 1940s, used these hedge fund strategies.
It still accounts for a massive share of equity hedge fund assets in current times.
Concept: Investment means encashing on WINNERS as well as LOSERS
Mantra: Pledge long positions in winners as collateral to fund short positions in losers
Result: Combined portfolio creates more profit than loss and lowers the market riskSeeing the Bigger Picture: Global Macro
This type of hedge fund examples encashes on systematic movements in financial as well as non-financial markets via trading in the following:
Global Macro = Major Market Trends,
Individual Security Opportunities
Emerging Markets Strategy: Spotlight on Less Mature Markets
These are funds that have links to emerging, less mature markets. Short selling is not permitted in such markets as futures and options are not possible. Funds are long in such a strategyFOF: A Money Mammoth
FOF, or Funds of Funds, is a fund that makes investments in multiple underlying top hedge funds (typically 10 to 30).
Some FOFs are even more diversified; these are liquid and available to individual investors.Learning from Management Masters: How Hedge Fund Managers Operate Convertible Arbitrage
This is when hybrid securities come into use, combining a bond with an equity option.
Managers maintain a delta-neutral position where bonds and stocks offset each other as the market fluctuates.
This hedge fund strategy thrives on volatility; the higher the stakes, the more the profit.Event-Driven
Managers use such hedge fund strategies when the biggest hedge funds purchase company debt from firms facing financial bankruptcy.
In this hedge fund example, managers typically focus on senior debt. If a company has already filed for bankruptcy, the junior class of debt may be a wiser hedge.
In such a strategy of hedge fund definition, investors need to be patient. This is because corporate reorganization can take a lot of time.Credit or Capital Structure Arbitrage
In this credit strategy, managers watch out for the relative value between senior and junior securities of a single corporate issuer.
Securities of equivalent credit quality are taken from different issuers.
Credit Hedge Funds = Focus on Credit, Not Interest
Fixed Income Arbitrage
Managers glean returns from risk-free government bonds, making a leveraged guess on how the yield curve’s shape will change.
High leverage comes into use for capitalizing returns. The flipped? Leverage causes a greater risk if the manager is incorrect.Macroeconomic Strategies
This plan involves analyzing how macroeconomic trends will impact interest rates, currencies, commodities, or equities.
Future and currency forwards are most commonly traded in this form of hedge fund careers.Leverage
This is one of the best (and worst) tactics employed by managers over time. It is the best because strong trading or investment returns are possible. It is also worse if it forces a sell-off, as hedge funds receive margin calls and are forced to sell positions to meet them.Long Only
These hedge fund strategies are used when a hedge fund owns long positions in stocks, or other assets looking for an alpha to the upside to outdo benchmarks. For the hedge fund example, if S&P500 is the benchmark, it is up 10%, and the hedge fund is up 12%; an extra 2% difference between the two is an alpha generated by a portfolio manager.Short Only
In this hedge fund strategy, the manager sells stock shorts. Portfolio managers who engage in shorting have been crushed given the market’s rising tide, which has uplifted sentiments. An example of a Short Only strategy is MySpace, once a leader in social networking and now a virtual non-entity in the social media space.Fair Trade/Long/Short Strategy
When the fund matches stocks in the same sector, which is long or owns stocks and engages in shorting, fair trade is the result.Market Neutral
The flipside: Massive moves upward or downward will negate the other sideRelative Value Arbitrage
A strategy used to hedge funds trading debtMan Vs Machine: Quantitative Hedge Fund Management
In this type of hedge fund definition, computer programming uses statistical models and data to locate the alpha camouflaged by market abnormalities.Risk Measures Used in Hedge Fund Strategies
SD or Standard Deviation: Defined as a level of volatility of returns measured in terms of percentage provided on an annual basis.
Decoding the Results: Variability of annual returns and funds can be compared with SD.
If 2 funds of the same annual returns have different SDs, the one with the lower SD will be more attractive and vice versa.Additional Metrics
Value At Risk/VaR: measures dollar loss expectation occurring with a probability of 5 in 100 or 5%.
Downside capture: Degree of correlation of fund to markets which are sliding
Rule of thumb: Lower the downside capture, the better the fund is at preserving wealth in the face of a meltdown or vice versa
Drawdown: Maximum drawdown is a measurement of the percentage fall in cumulative return from previous highs. You can assess which funds preserve wealth…these will be the ones that minimize drawdowns.
Leverage: If this increases, funds sell assets at massive discounts to cover margin calls. This serves as a good measure of the health of the hedge fund. Lower leverage is just what the doctor ordered.
Qualitative indices: These include an assessment of the manager, a scale of operations, and back-office administration, to name just a few.
Soft Close Versus Hard Close: Soft close means no additional investors will be allowed, while hard close means there will be absolutely no additional investments.Why Invest in Hedge Funds?
Return EnhancementWhat to Watch Out For Due Diligence/Caveat Emptor?
A low-volatility hedge fund can explode (courtesy of the subprime mortgage crisis of 2007 and its associated market meltdown in 2008). So allocation considerations are very important
The allocation should consider the overall risk.
Another important point to look out for is the level of gross as well as net exposure of the overall portfolio when adding hedge funds to a portfolio.
The definition of the measurement criteria in quantitative and qualitative terms is vital.Define Measurement Criteria
One should define criteria in both quantitative and qualitative metrics.
Usually, hedge fund managers send a pitch book describing the firm and its many aspects, such as strategy, principles, and performance. Analysts and investors should ensure they have accessed the pitch book for data.
Compare the hedge fund strategies to those within a similar category to assess how funds performed.
Additional analysis can then be made to decide whether the hedge fund strategies should be invested in or not.
A background check of the firm and an assessment of its back-office operations are some of the qualitative aspects of due diligence.Conclusion
A hedge fund definition is about securing gains and cutting down on losses. Effective hedge funds perform well based on concrete parameters and associated criteria for tangible reasons. Financial wizardry requires the right formula for success. Investors must be aware and alert to get maximum returns and minimum losses from hedge funds. Capitalizing on markets (whether bull or bear) has never been easier.Recommended Article
Here are some further related articles to learn more:
Testing input lag is a challenging and inexact process. Even RTings, a trusted source of input lag tests, says they had to develop their own tool to make it work, and only some people have the appropriate hardware to do so. However, there is still a way you can test your input lag if you have access to a CRT monitor or a screen with an input lag you already know.
Input lag is the time it takes between when your computer receives a signal, sends it to your monitor, and the action appears on the screen. Most of the time, it isn’t very noticeable. For example, when you’re watching streaming video, it sends one frame after the other, and any lag is accounted for because each frame has the same rate, and you aren’t inputting any signals from your mouse and keyboard.
One example of lag that’s easy to see is when you’re typing a sentence. It may take a split second between when you press the key and when the letter appears on the document. It’s almost imperceptible because of how low the input lag is on most modern systems. People used CRT displays with basically no input lag in the past, so it wasn’t an issue then.
There are times when input lag matters a lot, though. For example, competitive gamers can suffer if the input lag between a computer and the display is too high.
If you haven’t experienced different input lags, try typing on this Lag Simulator at 0ms and then at 400ms. You’ll see a noticeable difference.
Sometimes the input lag doesn’t matter much. If you’re not doing fast-paced gaming, you may prefer a display with different specifications and a little more lag. Displays with low input lag often aren’t quite as visually appealing as displays with high input lag numbers because of the types of panels they use to get the low ms rating. This is also why televisions usually have a higher input lag than PC monitors.
However, as monitor technology improves, displays with low input lag look better and better. There’s a lot less to compromise on now than there was even five years ago.
The lag you experience is affected by a few different factors.
The best way to find out the input lag of a monitor is to check with the manufacturer or look up independent ratings. Since it’s hard to control for all the factors on an at-home test, they’re not very accurate and won’t give you a rating that’s completely right.
However, you can still check to get an idea of how bad your input lag is in a few ways.
To test the lag of your display on your own, you need a monitor that you know the input lag rating of and a camera in addition to the monitor you want to test. However, this won’t be as accurate as the information you’d get from the manufacturer.
One of the primary reasons this doesn’t give a perfectly accurate input lag rating is that you can’t control how quickly the monitor sends signals to the monitors with different cables and connection types. If it prioritizes sending it to the display you’re testing, it may appear to have a lower input lag than it does compared to the control display.
You can do many things to improve your input lag numbers, even without switching your monitor.
You can monitor your performance with these changes to see how each affects your lag. Changing things as you go can help create the perfect setup for your needs.
The amount of input lag you can deal with depends on your computing activities and personal tolerance. Some people don’t mind a bit of delay when doing everyday activities like typing emails or navigating the internet. Some people prefer an instant response, even during those common activities.
For gamers who rely on fast-paced actions, like competitive shooters or MMO end-gamers, a total input lag under 40 ms can be helpful. If you check out what displays professional players use, they’re generally ones that introduce less than 10 ms to the lag.
Your HDMI cable will introduce some input lag because it takes microseconds to send the signal from the computer to your display. However, the delay is so slight that you won’t even notice it.
Most of your computer components will introduce a bit of lag as they do the processing and work necessary to make your computer run. If one of your components creates a bottleneck in your system, that could delay processing and introduce even more lag as well.
You will still have some input lag, no matter how fast your internet is. However, some lag is also introduced if you’re connecting to another server because of how that server performs and how good your connection to it is. If an external server is slow, you won’t be able to have things work at your optimum speed because that server isn’t providing enough speed for a smooth experience.
Most televisions have higher input lag than most monitors. While it isn’t true across the board, it is true as a general rule. You should always check with the manufacturer and read what kind of lag the display has before buying it, though.
You may be surprised at how bad specific displays can be – like I was when I tried to play a first-person shooter on the first 75-inch TV I ever hooked to my computer. The lag was terrible enough to make it unplayable.
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