hedge fund
DefinitionA fund, usually used by wealthy individuals and institutions, which is allowed to use aggressive strategies that are unavailable to mutual funds, including selling short, leverage, program trading, swaps, arbitrage, and derivatives. Hedge funds are exempt from many of the rules and regulations governing other mutual funds, which allows them to accomplish aggressive investing goals. They are restricted by law to no more than 100 investors per fund, and as a result most hedge funds set extremely high minimum investment amounts, ranging anywhere from $250,000 to over $1 million. As with traditional mutual funds, investors in hedge funds pay a management fee; however, hedge funds also collect a percentage of the profits (usually 20%).
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hedge fund is ...
... part of the Mutual Funds subject.
... part of the Mutual Funds subject.
... #26 on our list of the most popular terms.
... an essential investing term.
Related Terms
prime broker, algorithmic trading, alternative investments, fund administration, side pocket, total return swap, bear funds
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