More info on Wikipedia
Quick Facts
- Hedge funds often carry secretive undisclosed risks.
- US requires that majority of investors have a net worth more than $1 million.
- Worldwide hedge fund industry is estimated to be worth $1 trillion.
- First hedge fund was set up by Alfred W. Jones in 1949.
- Attempts to eliminate market volatility via arbitrage and hedging.
Expert summary
Hedge Funds are private, unregistered investment pools where many smaller individual contributions can be invested on a collective basis. A hedge fund is structured such that the fund itself has no employees and no assets other than its cash and investment portfolio. The fund's portfolio is then managed by the hedge fund manager which is the actually company that invests the pooled money in various markets. Hedge funds usually attract wealthier more sophisticated investors because most hedge funds are more likely to make high risk investments. In the United States, the primary difference between hedge funds and other investment vehicles is that they avoid most government regulation.
Recommended content by 2 experts
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