We don’t recommend hedge funds, neither do we recommend long/short strategies.
Hedge funds are not an investment strategy. They are a compensation mechanism which provides a method to bypass the normal regulatory process governing registered investment advisors. Some, but not all, hedge funds actually hedge the market. Some mutual funds also employ a hedging strategy. The most common strategy for hedging the market is called a long/short strategy.
A long/short strategy consists of taking some portion of your investment and purchasing stocks hoping that they will go up. Generally managers presume that they have a methodology for selecting the stocks …
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