A Hedge Fund is a private equity fund that provides a hedge against market conditions. It is certainly not easy to manage and run a Hedge Fund. Statistics suggest Hedge funds around the globe manage more than a trillion dollars of private equity. It is invested in commodity, currency indices and stocks and bonds. As opposed to traditional investing a Hedge Fund may go long or short the market. Since it is a private equity, taxation rules are likely to be different than normal capital gains taxes.
Basically a Hedge Fund is formed by individual investors who have a stake in the fund. Normally buy-ins are always in the millions. George Soros and the Blackstone Group founded by Peter G. Peterson and Stephen A. Schwarzman are two of the noted Hedge Funds.
The Blackstone Group is a fairy tale. The Blackstone Group was founded by Peter G. Peterson and Stephen A. Schwarsman. According to the Blackstone Group corporate biography the initial private funds in 1985 were $400,000. By forging alliances and partnerships with some of the most well-heeled on Wall Street their assets under management are over 88.5 billion dollars.
The Blackstone Group is a considered a world leader in alternative investment strategies and investment counseling. It could manage to raise fresh inflows of about 22 billion dollars in a recent IPO.
Hedge Funds are only a segment of the Blackstone Group Investments. The Blackstone Group has a stellar Hedge Fund management in the world market. Its group of Hedge Funds are uniquely tailored for a variety of investment strategies and goals. In fact the Blackstone Group can provide individualized tailoring of a Hedge Fund to fit the needs of large investment endowments and retirement funds. Anyone can purchase a unit of stock in the Blackstone Group through a licensed stock broker. It trades on the New York Stock Exchange under the stock ticker BX.
Another financial wizard George Soros is worth mentioning. His ability to sense movements in the market place is known throughout the financial world. His Hedge Fund and investment company is Quantum Fund. He senses weaknesses and strengths as only a master financial investor/trader can. In 1992 his legendary move to short the British pound nearly broke the Bank of London is part of the lore of George Soros. He can play the upside or the downside of any market. Some may call it a sixth sense, but it is an all encompassing ability to assess with precision the reality of the market and strengths of the underlying values with the reactions of the wild and crazy speculator will do. It is this investor savvy that has placed him in the Forbes wealthiest category.
You will find there are thousands of Hedge Funds present in markets across the world. Lately some have not done as well due to the roller coaster ride that has taken place. This is the time when the true test of a Hedge Fund manager is put to the test. The average mutual fund holder or retirement beneficiary may be surprised to learn that their funds are in part invested in low risk Hedge Funds. Historical records show that some of the most successful endowment funds have utilized the Hedge Fund investment to capitalize on market movement and volatility.
Hedge Funds are managed by highly qualified finance professionals who are supposed to be very sharp and quick in taking decisions.Those who can't, will nor survive in this lucrative yet risky field of Hedge Funds.
