What Is A Hedge Fund In Simple Terms?
What Is A Hedge Fund In Simple Terms?
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prashanth0011
Hedge funds is an aggressively managed portfolio of pooled funds.The investors use different strategies for investing money in hedge funds to be able to earn high returns for active users. It uses leveraged, long, short and derivative positions.
Hedge funds are characterized by the following:
1. Unregulated: It means where the hedge funds is operated from
2. Area of investment: Hedge funds can invest in anything like land, stocks, derivatives, etc unlike mutual funds
3. Liquidity: They are illiquid for a lock up period
4. Leverage: Hedge funds maximize their gains by using leverage
You can read https://www.feedough.com/what-are-hedge-funds-meaning-types/ this article to know about the types of hedge funds.