What is a hedge fund?
A hedge fund is an alternative investment vehicle that pools capital from accredited investors or institutions to employ diverse strategies aimed at generating active returns. These strategies can include leveraging, short selling, and derivatives trading, among others, to maximize returns and manage risk. Hedge funds are typically less regulated than other investment funds, allowing for greater flexibility in their investment approaches.
Hedge funds in the context of family offices
Family offices often invest in hedge funds as part of their broader investment strategy to achieve high returns and diversify their portfolios. Given their substantial assets and long-term investment horizons, family offices can benefit from the sophisticated strategies employed by hedge funds, which may not be accessible to individual investors. However, they must also carefully assess the associated risks and fees.
