A private investment fund that uses sophisticated strategies and can invest in virtually any asset class, often employing leverage, short-selling, and derivatives. These funds typically serve wealthy investors and institutions, charging high fees for potentially higher returns.
Named by Alfred Winslow Jones in 1949 for his strategy of 'hedging' long stock positions with short positions to reduce market risk. The term expanded to describe any alternative investment fund using non-traditional strategies, even if they don't actually hedge.
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