What is a Hedge Fund?
A hedge fund is an institution that pools funds from large investors and uses that money to invest in a variety of financial markets.
Hedge funds have traditionally operated with very little oversight by regulatory institutions, allowing them to engage in risky behavior in the quest for higher returns. This has been changing recently with some laws being passed to increase the regulations on hedge funds.
Hedge funds are investment funds that combine money from high net-worth investors to construct a joint investment portfolio with the hope to beat market returns.
Because Hedge funds seek high returns, they are typically aggressive in their investment strategies and are therefore more risky than other investment institutions.
A hedge fund is an investment vehicle used by accredited investors to pool funds together and allow a professional (or group of professionals) to manage their money. The hope is that the hedge fund will yield them better returns than if they tried to invest on their own.
A hedge fund is a partnership between a group of wealthy investors and a money manager. The investors pool their money into the hedge fund and let the manager invest it in ways that he sees fit.
Hedge funds are mostly deregulated and can therefore participate in risky investments like shorting, options, etc. that are usually forbidden to other types of funds.
Simply put, a hedge fund is a group of rich investors putting their money together and letting an expert invest it for them.