DumbList

Hedge funds are funds that are usually private funds - meaning these funds are usually run for a relatively few individuals / entities unlike mutual funds which typically have hundreds of thousands of investors. Because these are private funds run for a few select people (usually very rich people), these funds are relatively less-regulated - in other words, not too many people know or can control what these funds do.

Hedge funds tend to make riskier investments than their more stable counterparts such as mutual funds. They can hence provide greater returns, but the chances of losing a lot of money are also higher than usual.

Labels: finance, investing