RT Journal Article SR Electronic T1 Diversification and Yield Enhancement with Hedge Funds JF The Journal of Alternative Investments FD Institutional Investor Journals SP 50 OP 58 DO 10.3905/jai.2002.319063 VO 5 IS 3 A1 Gaurav S. Amin A1 Harry M. Kat YR 2002 UL https://pm-research.com/content/5/3/50.abstract AB In this article, the diversification effects from introducing hedge funds into a traditional portfolio of stocks and bonds are studied. The authors find that although the inclusion of hedge funds may significantly improve a portfolio's mean-variance characteristics, it can also be expected to lead to significantly lower skewness and higher kurtosis. This means that the case for hedge funds is less straightforward than often suggested and includes a definite trade-off between profit and loss potential.