"Market neutral" funds balance their portfolios between long and short stock bets to (ideally) remove the impact of market performance on the portfolio's return. Such funds often employ leverage, which increases both profits and losses. "Long/short sector" funds concentrate on specific industry sectors, such as technology or healthcare, but they also usually make market-direction bets by owning more longs than shorts, or vice versa. "Emerging markets" funds go long and short stocks and bonds in markets like Indonesia, Brazil, and China. "Merger arbitrage" funds take advantage of the risk discount between the stock of a company that is about to be acquired and the announced acquisition price, betting either that the merger will or won't go through. "Distressed securities" funds buy and sell the securities of companies in crisis, which often trade at a panic discount (and which often deserve that discount).