( The Hartford Courant – www.courant.com ) Hedge funds have become part of the cultural landscape. But many who use the term – including some would-beinvestors – do not understand what, exactly, a hedge fund is.
Hedge funds began as investment pools that aimed at achieving consistent returns, regardless of which way the market moved – and charged their clients mightily for it.
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But the money to be made – by those who manage hedge funds, not necessarily by those who invest in them – proved so intoxicating that even neophytes began opening up shop.
Now, many hedge funds do not hedge at all. Instead, the term “hedge fund” has become a catchall, referring simply to the 8,500 unregulated investment partnerships that share a common way of rewardingtheir fund managers.
