Hedge Fund

A hedge fund is a private investment fund that charges a performance fee and is typically open to only a limited range of qualified investors.

Hedge funds may be completely hedged, taking on very little risk, or completely speculative, taking on immense amounts of risk. The bulk of hedge funds describe themselves as long / short equity, but many different approaches are used taking different exposures, exploiting different market opportunities, using different techniques and different instruments.

Below is a list of different markets, strategies, exposures that hedge funds use to maximize its profit:
• Style or strategy: global macro, directional, event driven, relative value (arbitrage), managed futures (CTA)
• Market: equity, fixed income, commodity, currency
• Instrument: long/short, futures, options
• Exposure: directional, market neutral
• Sector: emerging market, technology, healthcare etc.
• Method: discretionary, systematic
• Diversification: multi manager, multi strategy, multi fund, multi market