Financial market behavior and key trading strategies―illuminated by interviews with top hedge fund experts Efficiently Inefficient describes the key trading strategies used by hedge funds and demystifies the secret world of active investing. Leading financial economist Lasse Heje Pedersen combines the latest research with real-world examples to show how certain tactics make money―and why they sometimes don’t. He explores equity strategies, macro strategies, and arbitrage strategies, and fundamental tools for portfolio choice, risk management, equity valuation, and yield curve trading. The book also features interviews with leading hedge fund managers: Lee Ainslie, Cliff Asness, Jim Chanos, Ken Griffin, David Harding, John Paulson, Myron Scholes, and George Soros. Efficiently Inefficient reveals how financial markets really work. " Efficiently Inefficient is a truly modern and masterful introduction to how finance will be studied and practiced in the twenty-first century." --Andrei Shleifer, Harvard University "A tour-de-force combination of original research and provocative interviews with hedge fund managers." --Laurence B. Siegel, CFA Institute Research Foundation "Encyclopedic in its cataloging of active management strategies and authoritative in its analysis of the practical issues of their implementation." --Martin S. Fridson, Financial Analysts Journal "For a book on investments, Efficiently Inefficient sets a completely different and higher standard." --Darrell Duffie, Stanford University "This valuable and intriguing book provides a contemporary survey of investments across a wide spectrum of asset classes and strategies. Combining a wonderful narrative with a rigorous analytical structure, Efficiently Inefficient serves the needs of students, serious investors, and professionals." --Gary P. Brinson, CFA, GP Brinson Investments "Encyclopedic in its cataloging of active management strategies and authoritative in its analysis of the practical issues of their implementation." ―Martin S. Fridson, Financial Analysts Journal "This valuable and intriguing book provides a contemporary survey of investments across a wide spectrum of asset classes and strategies. Combining a wonderful narrative with a rigorous analytical structure, Efficiently Inefficient serves the needs of students, serious investors, and professionals." ―Gary P. Brinson, CFA, GP Brinson Investments "For a book on investments, Efficiently Inefficient sets a completely different and higher standard." ―Darrell Duffie, Stanford University " Efficiently Inefficient is a truly modern and masterful introduction to how finance will be studied and practiced in the twenty-first century." ―Andrei Shleifer, Harvard University "A tour-de-force combination of original research and provocative interviews with hedge fund managers." ―Laurence B. Siegel, CFA Institute Research Foundation "This valuable and intriguing book provides a contemporary survey of investments across a wide spectrum of asset classes and strategies. Combining a wonderful narrative with a rigorous analytical structure, Efficiently Inefficient serves the needs of students, serious investors, and professionals. It is an important contribution to the investment literature." --Gary P. Brinson, CFA, GP Brinson Investments "For a book on investments, Efficiently Inefficient sets a completely different and higher standard. Pedersen blends the best and latest research, accessible to both MBA students and professionals, with the insights of some of the world's leading hedge fund managers. It works beautifully." --Darrell Duffie, Stanford University " Efficiently Inefficient is a truly modern and masterful introduction to how finance will be studied and practiced in the twenty-first century." --Andrei Shleifer, Harvard University "How are markets efficient enough to stump most investors, yet inefficient enough to allow hedge fund managers to earn huge profits? Lasse Pedersen, who has contributed greatly to the 'new finance' of liquidity and financial frictions, answers this question with a tour-de-force combination of original research and provocative interviews with hedge fund managers." --Laurence B. Siegel, CFA Institute Research Foundation "Lasse Pedersen is a gifted financial market theorist who understands that theory is most satisfying when it is combined with a deep practical understanding of institutional detail and market frictions. This terrific book showcases his strengths in all of these dimensions." --Jeremy Stein, Harvard University "This accessible book explains hedge fund strategies and how to design, construct, evaluate, implement, and risk manage them. The section on securities lending and borrowing is interesting and novel, and Pedersen's discussion of macro and central bank strategies is one of the best I have seen in any book on hedge funds. His account of portfolio construction is superior." --Robert Kosowski, Imperial College Busines