Market neutral vs short extensions strategy position, difference, net, industry, long

brain_wash_your

Guys, I really need some helps to clarify the difference of the two. I think that:

+ Market neutral : you long undervalued and short overvalued securities in a same industry with equal beta => Your net exposure is zero beta, no systematic risk. You can add systematic risk (equitizing your position) by long equity future.
+ Short extension : You long stock and short the same stock (by doing this you can adjust your beta).

After all, both strategies offer you methods to adjust beta of the portfolio. However, short extension portfolio doesn't require other position to gain exposure to market factors.

Am I right?

Windjammer

pure market neutral strategy will have beta of zero because you are offsetting longs with shorts

short extension strategy will not have a beta of zero because you are long 130% and only short 30% in most cases