This video provides an introduction of how hedge funds are structured, the typical fees charged by them, and how the managers get paid. The most common structure followed by hedge funds is the general / limited partnership. In this model, the general partner will be responsible for managing the fund and will also have an […]
The hedge funds generally have a suspicious or a negative tone associate to them. This video analyzes the hedge funds business and highlights some of the characteristics which make it good and bad for different people.
The market for hedge funds has grown significantly and there are many types of hedge funds around the globe. These hedge funds can be classified based on their size, global reach, and investment strategies among others. However, these classifications are not exclusive and there is some degree of overlap. Presented below is one type of […]
Even though hedge funds are very popular, they are not accessible to small investors because of the higher amount of investment required. An alternative is a fund of hedge funds that allows all kinds of investors easy access to the hedge funds. Unlike a hedge fund that invests in stocks, bonds and other securities, a […]
There are two important points that need special mention while discussing hedge funds. One, hedge funds make extensive use of leverage. Some people believe that leverage is the major source of risk for hedge funds, while others argue that using leverage combined with risk management enhances hedge fund returns. Second, hedge funds face certain unique […]
The information about hedge funds is not publicly available or listed on any exchange. Investors have to obtain this information directly from the hedge funds or data provider specializing in collecting hedge fund data. Many such hedge fund data providers also publish indexes. These indexes allow easy tracking of the performance of hedge funds and […]
The hedge fund industry does not have a very evolved performance measurement framework. This makes it difficult for investors to depend on the historical records while allocating their funds. The performance data provided by the hedge fund databases and indexes has several biases. Let’s discuss some of these biases. Self-selection: The inclusion in a hedge […]