Hedge funds for beginners

[TheOmegaMan]

There is a lot of research showing the majority of hedge funds do not offer superior returns in the long run:

http://papers.ssrn.com/sol3/papers.c...ract_id=881105

[GeorgeGregan]

Article on why not to buy hedge funds

http://www.slate.com/id/2155871/entry/2156310/

[Buffoon]

The FSA has started making noises about them , regulating them more tightly.

Yeah, right! First sign of the FSA actually doing something and the money would be out the country quicker than Tony can take a bribe.

Potentially lucrative if you work for them as a contractor (I should know) or a perm but they hard to get into.

This is true.

As a headline you will need a minimum of a £250,000 to invest.

In a fund of funds maybe. A HF wouldn't return your calls if you could only scrape 1/4 million together.

[sasguru]

... Potentially lucrative if you work for them as a contractor (I should know) ...

How do you know? have you worked for a hedge fund? And if so doing what?

[DimPrawn]

This message is hidden because Chico is on your ignore list.

He said God views hedge funds very dimly and Satan is not bothered either way.

HTH

[Churchill]

This message is hidden because Chico is on your ignore list.

[Chico]

Hmm Hedge funds are for those in the high investment high risk category. The FSA has started making noises about them , regulating them more tightly. Potentially lucrative if you work for them as a contractor (I should know) or a perm but they hard to get into. As a headline you will need a minimum of a £250,000 to invest.

[milanbenes]

Hi TL,

glad to see you are aware the HF downs as well as ups.

Is there any investment where you can 'But as long as I can't lose more than I put in I'm OK.' ?

Even Lloyds names got bailed out in the end.

Milan.

[thunderlizard]

BB,
That's the way I'm thinking. At the moment, a falling UK equities market would make me lose more than I'd like. It would be good to have something that could provide some hedge against that.

Milan,
Your concern is appreciated. I wasn't a million miles away when US natural gas prices went through the floor and nearly knocked out Amaranth. But as long as I can't lose more than I put in I'm OK.

[BlasterBates]

From what I've seen Hedge funds on the whole make disappointing returns. Occasionally they do well. A hedge fund would be interesting when the market gets volatile and shares are likely to drop a lot, "theoretically" they should make money on options. Actually to have some money in a hedge fund might be a good "hedge". The thing is a lot of hedge funds started after the 2001 crash so its difficult to know how they'd do.

[milanbenes]

tl,

be careful with hedge funds

they are big gambles, and there have been some
high profile massive losses

as ever in life, the more sophisticated the investment,
the more chance there is a losing a lot of money

all the best,

Milan.

[Buffoon]

Is it possible to invest in a hedge fund as an individual

Oh Yes! In most investors in HF are individuals.

with the kind of sum that your average contractor would have lying around (or more likely, 15-20% of it)?

Oh No! (unless you are threaded) The amount of dough that you need to be an investor is a bit more that contractors earn in a lifetime.

[Sockpuppet]

Have you spoken to a IFA? Sayara Beg swears by them and look where it got her!

[thunderlizard]

Is it possible to invest in a hedge fund as an individual, with the kind of sum that your average contractor would have lying around (or more likely, 15-20% of it)?

I know they don't sell directly. Some people have advised buying shares in publicly quoted hedge fund companies, but that sounds like a very wateres-down way of going about it.