STRATEGIES FOR BUILDING A SUCCESSFUL HEDGE FUND
Managing Technical problems
A critical risk to be reckoned with is technology breakdown as there will be frequent failures with the technical equipment used in running the programmes and codes associated with hedge fund trading. The technology used for hedge fund is really complex and challenging and the process of fine tuning is as time demanding as the programming of all applications and algorithms. It won't be so difficult to make a couple of programmes work together and assure that they all do what they are intended to do if some attention is given to the fact that there are technical challenges to be encountered. A Strategy needs to be developed to manage this risk. One proven suggestion from practitioners is to spend significant time to test and fine tune the programmes, codes and other technology to avoid their failures. The fact has to be emphasised that that there are weak moments in automated trading. This is a fact and cannot be wished away.