You're here:  Home --> Dictionary --> H --> Hedge Fund

Arbitrage
Long-short
George Soros
Market Neutral

Hedge Fund
Term category: Mutual Funds
In 10 words or less: A private investment fund that seeks positive absolute returns.

Definition: A fund allowed to use a number of strategies to make money. Because hedge funds are restricted on the number of people that can invest in them, they typically require that you invest at least $250,000. Hedge funds pride themselves on being able to make money when the stock market drops. However, some hedge funds are very risky.

StockJargon Advice: Hedge funds come in all different types of flavors: market neutral, currency, interest rates, short funds, special situations, and mergers and acquisitions.

Hedge funds don't face the same regulations so they can use advanced investing techniques, as well as futures and options, to achieve higher rates of returns.

A hedge fund makes money by taking the first 20% of the profits. If it has a couple bad years in a row, the company won't be making any money. That's why few hedge funds survive two or three consecutive bad years.

Related Articles

Hedge Fund Strategies
Hedge funds use a variety of different strategies to attract investors and earn high returns. Read more about them in this article.

Hedge Funds
Looking for some big gains and high risks? You might want to consider these.

Fund Classifications
Learn about the different types of fund classifications and objectives.

Related Books

When Genius Failed by Roger Lowenstein <--Incredible book!
All About Hedge Funds by Robert Jaeger
Trade Like a Hedge Fund by James Altucher
Running Money By Andy Kessler

# -A - B - C - D - E - F - G - H - I - J - K - L - M - N - O - P - Q - R - S - T - U - V - W - X - Y - Z