Hedge Funds Overview

A private hedge fund can bring a different perspective to an investment portfolio that may otherwise not be available. Since these funds can invest in ways that are different from publicly registered funds, performance can be quite different as well, with the potential for higher returns. For those investors with particular needs, or specific performance objectives, this fund class may have the solutions an investor is searching for.

Hedge funds can have broad or targeted investment styles. Some funds may utilize the more recognized approach of investing in well-known securities using leverage and margin to pursue higher returns in shorter time frames. Hedging strategies may also be used in these funds, creating more risk but allowing the fund to pursue returns more aggressively. Other funds may focus on less-known or unusual investments, with or without long holding periods, that are anticipated to be lucrative at the end of their investment cycle. Hedge funds may be very short-term focused, or may focus on other areas away from returns, such as investing in specific market segments or setting specific targets like managing market risk exposure. The range of investment can vary widely, so it may be possible to find a fund that fills a particular goal in an investment portfolio.

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