Credit Suisse has launched the Long/Short Equity Replication Index, the first in a planned suite of alternative index replication products designed to replicate the performance of major he

Credit Suisse has launched the Long/Short Equity Replication Index, the first in a planned suite of alternative index replication products designed to replicate the performance of major hedge fund strategies.

The Credit Suisse Long/Short Equity Replication Index aims to capture the risk/return characteristics represented by the Credit Suisse/Tremont Long/Short Equity Hedge Fund Index.

'Long/short equity is typically the largest allocation and dominant return source in hedge fund portfolios, and investors are increasingly concerned about the correlation of their hedge fund investments to the broad equity markets,' says Oliver Schupp, head of beta strategies at Credit Suisse. 'This index allows them to gain systematic exposure and enhanced liquidity through a direct investment, or tactically to adjust their portfolios through a short position.'

Walter Rotondo, head of fund-linked products, adds: 'The Long/Short Equity Replication Index allows our clients to participate in the performance of this rapidly growing market segment.'

The Credit Suisse alternative index replication approach, led by head of research Jordan Drachman, draws upon a strategic alliance with three leading academic researchers in the field of quantitative investments, Bill Fung, David Hsieh, and Narayan Naik.

The three research advisors are helping Credit Suisse, which has been active in the measurement of alternative beta for more than a decade, to fine-tune the development of the long/short equity replication model with independent viewpoints that ensure a sound academic basis for the methodology.