The investment strategy of a hedge fund is to invest in:

Question

Quizplus · Accepted Answer

The name 'hedge' typically refers to the fund's desire to avoid losses in market downturns.Traditionally,the manner in which this has been achieved is to enter into derivative contracts.However,today hedge funds encompass much more than a form of portfolio insurance.Hedge funds are generally classified as those funds that adopt an investment strategy,or invest in certain securities,that are different from those found in traditional mutual-style funds.Hedge fund strategies vary enormously.The primary aim of most hedge funds is to reduce the volatility of returns on the portfolio while simultaneously attempting to deliver positive returns under all market conditions.Hedge funds tend to have high levels of fees and restricted investor access.

The Investment Strategy of a Hedge Fund Is to Invest