Hedge funds charge both a set management fee (normally set at 2%) and a performance fee (typically varies from 10% to 30%), meaning as an investor, you will pay more the better the fund performs. The most common fee structure is known as 'two and twenty': a 2% asset management fee plus a 20% cut of any profits returned..
noun Definition of hedge fund : an investing group usually in the form of a limited partnership that employs speculative techniques in the hope of obtaining large capital gains Examples of hedge fund in a Sentence.
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A hedge fund is a private pool of money collected from an assortment of wealthy individuals and institutions such as trusts, college endowments, and pension funds. The pool is managed by a financial professional who invests the money in a variety of securities and financial contracts. Hedge funds are an important subset of the alternative investments space. Key characteristics distinguishing hedge funds and their strategies from traditional investments include the following: 1) lower legal and regulatory constraints; 2) flexible mandates permitting use of shorting and derivatives; 3) a larger investment universe on which to focus; 4) aggressive investment styles that allow ....
Hedge funds pool money from investors and invest in securities or other types of investments with the goal of getting positive returns. Hedge funds are not regulated as heavily as mutual funds and generally have more leeway than mutual funds to pursue investments and strategies that may increase the risk of investment losses.
A hedge fund is a type of investment in which a professional fund manager invests a pool of money for accredited investors, with the goal of maximizing returns and minimizing risk.
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