Part 3 on hedge funds begins with an introductory chapter, overviewing the industry and discussing how an institutional investor can establish a program of investing in hedge funds. Chapters 17 to 21 discuss five categories of hedge funds: macro and managed futures funds, event-driven hedge funds, relative value hedge funds, equity hedge funds, and funds of funds. Each of these categories groups hedge funds with similar investment strategies—for example, hedge funds that focus their investment ideas around certain events are grouped together in the event-driven hedge fund category. Each category is then further refined into strategies. For instance, there are four strategy groups within the event-driven hedge fund category: activist funds, merger arbitrage funds, distressed securities funds, and event-driven multistrategy funds.