about 11 months ago - 1 comment
Is there a difference between the two? In addition: http://www.bivio.com/index.html Is opening an account here the same as opening a hedge fund or an investment partnership? I know Warren Buffett began before Berkshire Hathaway the Buffett Partnership, is what is shown on this website similar?
about 11 months ago - 1 comment
about 11 months ago - 2 comments
or is it an unofficial, loosely defined term to describe entities with certain characteristics?
about 11 months ago - 3 comments
Every website about hedge funds seems to want to sell me a fund or tell me how great their company is. Is there a site that explains hedge funds without a sales pitch?
about 11 months ago - 1 comment
and who do I contact for information about the fund.
about 11 months ago - 2 comments
Is it a Finance major? Or an MBA with a focus on Finance? Or something else?
about 11 months ago - 1 comment
I read with all this bail-out stuff going on that hedge funds could responsible what is a hedge fund and how does it effect the economy?
about 11 months ago - 3 comments
I mean banks charge interest at maximum 15% per annum. But some of these guys promise returns of 25% and more! So why do they lose out that 10%? Why not simply borrow as much as is required from the bank?
about 1 year ago
Leveraging is basically financing the purchase of assets by borrowing as opposed to floating of shares or otherwise giving other forms of proprietary rights. Any purchase of an asset (not just by hedge funds) can thus be financed by leveraging.
about 1 year ago
Leverage is debt. In this case the hedge fund borrows money to buy more of something.
Many us use leverage to buy our homes and our cars. We borrow so to buy more of something. I can buy a bigger house by using leverage, a mortgage, than if I had to pay cash.
Hedge funds use leverage to magnify their returns, but this is a two edged sword. When the investment is up, the leverage increase the gain significantly. But when the investment is down, the leverage also increases the loss.
about 1 year ago
They borrow money to buy assets. If you buy a house for 100K and borrow 90K of it, you have 9:1 leverage. For hedge funds, if they make more than the amount it cost to borrow money, they juice returns. textbook.
about 1 year ago
Leveraging is using a loan for investments.
So a hedge fund is leveraged 14:1. That means, for every $1 the hedge fund invests, they get $14 in financing from their bank.
Woe to the hedge fund that makes a bad investment at a 14:1 leverage ratio. Very risky stuff.