hedge fund

A hedge fund is an investment fund, like a mutual fund, but much riskier. Hedge funds are a type of fund that is typically only available to very wealthy investors. They invest in stocks, bonds and other investments, with the goal of making the most profit for their investors. The managers of the hedge fund use complex strategies, like short-selling, options and futures, to try to make money even when other investors lose money. To invest in a hedge fund, you need to be an accredited investor, meaning you have a lot of money to invest and a lot of knowledge about how to evaluate investments. Hedge funds can be very profitable, but they also involve much higher risks than most investments.