John Puten is the chief investment officer of the Markus University Endowment Investment Office. Puten seeks to increase the diversification of the endowment by investing in hedge funds. He recently met with several hedge fund managers that employ different investment strategies. In selecting a hedge fund manager, Puten prefers to hire a manager that uses the following:

• Fundamental and technical analysis to value markets

• Discretionary and systematic modes of implementation

• Top-down strategies

• A range of macroeconomic and fundamental models to express a view regarding the direction or relative value of a particular asset Puten’s staff prepares a brief summary of two potential hedge fund investments:

Hedge Fund 1: A relative value strategy fund focusing only on convertible arbitrage.

Hedge Fund 2: An opportunistic strategy fund focusing only on global macro strategies.

Determine which hedge fund would be most appropriate for Puten. Justify your response.