Download All About Hedge Funds : The Easy Way to Get Started by Robert Jaeger PDF

By Robert Jaeger

Hedge money have lengthy been considered as mysterious, high-risk investments, incorrect for many traders. All approximately Hedge money debunks those myths and explains how any investor can benefit from the high-potential returns of hedge cash whereas incorporating safeguards to restrict their volatility and hazard. This clear-headed, common sense advisor tells traders: What hedge cash are--and what they aren't 4 key hedge fund concepts find out how to comprise hedge cash into an present portfolio kinds of probability inquisitive about hedge fund making an investment

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The Vinik saga is a perfect illustration of the brain drain that drives talented people from the highly structured world of institutional portfolio management into the freer world of hedge funds. So the great bull market provided fertile soil for two radically opposed investment options: the index fund and the actively managed fund run by an investment star. When the bull market ended, index funds became unappealing. Investors became concerned about owning “generic stocks,” and they became more interested in portfolio managers who may have some superior skill in running money.

In some firms, this minimum account size may be as small as $100,000. In other firms whose business is oriented mainly to large institutional investors, the minimum may easily be as much as $10,000,000 or higher. For clients who do not meet the minimum size requirement, commingled accounts are the only available option. Mutual funds and hedge funds are both commingled accounts. Many underlying investors pool their assets to create a single larger pool of assets that can be properly diversified and that is large enough to command the attention of a skilled money manager.

But every institution will have a small group of people who bear the ultimate responsibility for the investment activities of the institution. These people act as fiduciaries for the institution. They do not own the assets for which they are responsible. They are acting on behalf of the owners, and their responsibilities are similar to those of a lawyer who serves as the trustee of an estate or trust. The fiduciary responsibility typically resides in a board of directors, which normally forms an investment committee to assume detailed responsibility for investment decisions.

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