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All About Hedge Funds

Hedge Fund Basics

Hedge funds were once only available to the super rich. Now the middle class plays a huge role in $1-trillion industry1 by investing through mutual funds and pension plans. A hedge fund is typically a private investment that seeks above-average returns. Skilled traders and brokers obtain returns through skill-based investment strategies.

Hedge Fund Benefits

Investing in hedge funds provides the following benefits:

  • Hedge funds can deliver positive returns under almost all market conditions.
  • Investors who choose to invest in hedge funds have access to specialized strategies not typically available through traditional investing.
  • There are extensive risk-management techniques put in place to protect investors.
Hedge Fund Risks
  • ¬†Hedge funds have a lock-up period during which an investor cannot remove his investment.
  • Hedge funds are a high risk investment. There is a chance you could lose the bulk of your investment.
  • Due to complex tax structure for hedge funds, many investors may experience a delay in receiving important tax information.
  • Hedge funds have very few disclosure regulations which means you may not get the in-depth information you are looking for. Sometimes underlying investments will only be known to the investment manager.

Do you need assistance managing your trading portfolio? If so, contact the Winflow Financial Group. We offer a number of investor services for those looking for investment advice.

1Washington Post business article



Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.