The Free Lance Star- MediCorp Health System may start investing in “alternative investments” including hedge funds, an executive for the Fredericksburg nonprofit said.
MediCorp’s board of trustees will likely vote on that issue later this year, said Chief Financial Officer Lester W. Abernathy. He said the board’s investment subcommittee has been discussing alternative investments such as hedge funds and real estate funds, and it’ll likely be brought before the entire board this fall.
The investment guidelines for MediCorp, which owns Mary Washington Hospital in Fredericksburg, currently allow it to invest only in stocks and bonds. MediCorp has about $245 million in investment assets under management. There are no federal or state laws preventing nonprofits from investing in hedge funds.
If MediCorp does decide to invest in hedge funds, the subject will join a growing list of foundations and universities. The list includes the University of Mary Washington.
The hedge fund industry has about $2.6 trillion in assets under management, according to recent data from HedgeFund.net.
A hedge fund is a private investment fund typically open only to wealthy individual and institutional investors. They are not as closely regulated as publicly traded stocks, bonds and mutual funds. They use a large variety of strategies, but many hedge against downturns in the market to reduce risk while preserving capital. Those tactics are meant to make money in bull and bear markets.
