1. Hedge fund refers to a financial fund that combines financial derivatives such as financial futures and financial options with financial institutions and obtains profits by hedging transactions and high-risk speculation. Also known as hedge funds or hedge funds.
Compared with Public Offering of Fund, hedge funds generally use financial leverage. Compared with ordinary individual investors, hedge fund investors are often so-called complex or qualified investors, including high-net-worth individual investors and institutional investors. In the United States, a complex or qualified individual investor is defined as having a net asset of at least $6,543,800+0,000 (excluding his main residence) or an annual income of at least $200,000 in the past two years (an annual income of more than $300,000, if married) and expecting to maintain the same annual income this year.
2. The business model of hedge funds is firstly the organizational structure of funds. Hedge fund is an investment platform, and the business model of hedge fund (mainly refers to the legal framework) largely depends on the tax of the place where the fund is registered and the tax of fund investors. The general business model of hedge funds is limited partnership or limited liability company.
3. Common investment strategies of hedge funds include global macro strategy, trend investment strategy, event-driven investment strategy and relative value arbitrage strategy. The investment strategy is flexible, the leverage is widely used, and the risk exposure is established in multiple regional markets and multiple asset classes. Generally, exchange products and foreign exchange products with strong liquidity and large trading volume are the main ones.
In most countries, only the so-called complex and qualified high-net-worth individuals and institutional investors are eligible to invest in hedge funds. These investors fully understand the risks and related returns of investing in hedge funds.
There are two aspects of risk management in hedge fund industry: one is the risk management of hedge fund managers; Second, the risk management of hedge fund investors.
Hedge fund managers will take a series of risk management measures to protect the interests of investors. Many large hedge funds have adopted the most complicated risk management measures and the most advanced risk management technology in the asset management industry. Many large hedge funds have full-time chief risk officers and risk management teams. They identify, measure, monitor, report and manage investment risks under the framework of comprehensive enterprise risk management.
For a long time in the past, hedge funds have been regarded as extremely mysterious and disturbing the market. In the past two or three decades, investors in the global market have fully realized that the above views are not only one-sided, but also wrong. On the contrary, hedge funds play an active role in the process of asset allocation and investment in the global market and are an indispensable and important part.
6. Investors can use investment hedge funds to increase the diversification of the portfolio, thus reducing the overall risk of the portfolio. Hedge fund managers can choose to use special trading strategies and financial instruments to reduce market risks and obtain risk-adjusted returns consistent with investors' risk preferences.
7. In Hong Kong, the scale of most hedge funds is about $65.438+million to $50 million, and only those that reach the level of $65.438+0 billion to $500 million are considered large. Those whose scale exceeds $ 1 100 million are usually global macro investments or group operations, and most of them are European and American institutional customers. Soros's global macro fund has reached tens of billions of dollars, accounting for a small proportion in the Hong Kong market. Usually, only part of the funds are invested in Hong Kong to achieve the goal of diversification of asset allocation.