Hello, Can someone brief me on what are alpha transfer strategies and what are the risks of apha transfer strategies.Any web resource/link would also help.Warm RegardsManish

Big in Pensions at the moment:Buy an active manager in, for example, equities.Then swap the underlying market exposure with some sort of liabilities exposure (eg a market index with some sort of bond, inflation linked, interest/inflation rate swap portfolio).Then hey presto you get liabilities + alpha.This risk as always is that you dont pick an outperforming manager......Alternatively if yore doing it with a hedge fund managers,buy the hedge fund manager,swap cash for liabilities,Hey presto liabilities + alpha (close your eyes and prey the alpha aint beta.)

It was a real bouncer. Can you explain in simple and straight manner....what does alpha transfer mean and what are the various strategies.

ManishManagers are typically tasked with outperforming an index - cash for Hedge funds, some combination of market indexes for long only equity or bond managers. The benchmark performance is market 'beta'. Any outperformance is attributed to the manager 'alpha'. What happens if you think you've spotted some alpha, but dont want the beta? You swap out the underlying benchmark exposure using swaps into some sort of exposure you want. So the basic strategy is buy a manager, and buy a swap.Im not going to give you any examples, but that is the basic underlying principle in as clear a manner as I can manage. I suggest you do a google search for some examples, but it will probably be