HEDGEDUCATION - HEDGE FUND ARTICLES

There are many positions within a hedge fund that contribute to its overall success or the lack there-of. But while every player may be integral, hedge funds are a lot like a football team. The failure or success ultimately will be placed on the coach…or in this case, the Portfolio Manager.
The Portfolio Manager, … Continue Reading

Market conditions have never been better for setting up a forex fund. The number of forex funds and corresponding investors has grown as a result of expanding customer markets. Therefore, traders interested in starting a forex fund (or managing customer accounts) should familiarize themselves with the legal landscape as they consider earning a living in … Continue Reading

Hedge funds are limited to a specific group of sophisticated investors mainly because they are thought to have more experience with markets and investing. However, hedge funds aren’t without risk. While you can’t control market conditions, you can control who you choose to handle your money. Weeding out the bad apples can … Continue Reading

The term “hedge fund” was originally coined due the fact that managers would try to hedge the funds against risk in the market by taking both long and short positions. However, risk is almost impossible to avoid in today’s volatile economy, though hedge fund managers do try to use various risk control tactics.
There are … Continue Reading

When trying to maximize absolute returns, the importance of assessing and mitigating risk shouldn’t be underestimated. Some memorable examples like LTCM and Tiger Fund not only show how heavy losses can be for some participants of the hedge fund industry, but also reinforce the perception that a good record of high absolute returns can mean … Continue Reading

When most people think of Bear Stearns, they think of its recent collapse and the resulting purchase by JPMorgan Chase. However, the demise of Bear Stearns can really be traced back to two failed hedge funds during the summer of 2007 which created a domino effect on the entirety of the company. Let’s … Continue Reading

By JAMES R. HEDGES, IV, PARTNER, AND CHARLOTTE LUER, PARTNER, LJH FINANCIAL MARKETING STRATEGIES, AND LUCINDA O. MCCONATHY, PARTNER, AND PATRICIA C. O’PREY, PARTNER, RICHARDS KIBBE & ORBE LLP
Marketing a hedge fund involves a myriad of considerations, including compliance not only with the regulatory requirements and restrictions of the jurisdiction in which the hedge fund … Continue Reading

In 1949, Alfred Winslow Jones devised and implemented an investment strategy that would forever brand him as “the father of the hedge fund industry.” While working for Fortune Magazine and investigating financial strategies, Jones decided to launch his own fund and raised a total of $100,000, $40,000 of which was his own money.
Jones employed … Continue Reading

There are estimated to be over 10,000 hedge funds in existence today. Because they are not regulated like mutual funds and other investments, information on these funds may be a lot harder to find. Another reason for the scarcity of hedge fund information lies in the fact that only accredited investors, qualified clients, … Continue Reading

While there is no specific formula for how hedge funds work since different hedge funds employ a multitude of different strategies, there are some common characteristics that are present in most hedge funds. All hedge funds start with a hedge fund manager.
This manager brings a specific strategy or investment philosophy to the table. … Continue Reading

With regards to hedge fund investing, an accredited investor is not to be confused with a “qualified client.” Qualified Clients are the most attractive investors for hedge fund managers. They must meet one of the following criteria:

A natural person who or a company that immediately after entering into the contract has at least $ 750,000 … Continue Reading

Due to the risky nature of hedge funds, the Securities and Exchange Commission requires that investors meet certain minimum requirements. An “accredited investor” must meet one of the following prerequisites as defined by the SEC:

a bank, insurance company, registered investment company, business development company, or small business investment company

an employee benefit plan, within … Continue Reading

New hedge funds are launched daily, which is constantly increasing the importance of determining which hedge funds are appropriate for you or your firm to invest in becomes increasingly important. Every person or company is going to have different investment horizons, risk tolerances, strategy preferences, etc. so it is usually more valuable to know the … Continue Reading

A hedge fund manager and/or any person acting on its behalf may not solicit an investment into a hedge fund through any type of “general solicitation” or general advertisement” … Continue Reading

Aggressive Growth:
Invests in equities expected to experience acceleration in growth of earnings per share. Generally high P/E ratios, low or no dividends; often smaller and micro cap stocks which are expected to experience rapid growth. … Continue Reading

Hedge funds structured under foreign law, or located outside the U.S. are designated as “offshore hedge funds.”  Managers who desire to start a hedge fund offshore can enjoy several advantages over their domestic contemporaries. One advantage is that the fund and its investors are not subject to United States taxation. Another advantage is that since … Continue Reading

Hedge Fund Manager Capital Introduction
A hedge fund manager and/or any person acting on its behalf may not solicit an investment into a hedge fund through any type of “general solicitation” or general advertisement” under Section (c) of Regulation D.
As a result, an increasing number of hedge fund managers rely upon hedge fund advisory services … Continue Reading

Internet websites have to be careful with respect to general solicitations and advertising, and thus must limit the content of the website in addition to the people who have access to the site. Hedge … Continue Reading