How Hedge Funds Make Money

hedge-funds drawingBeing an avid reader of Financial Times, I like the educational videos they frequently publish. Below is one from today,  about how hedge funds differ from traditional investment funds and how they make money.

Hedge funds make use of short-selling, leverage and discretion to magnify their gains, but as the FT’s senior investment columnist John Authers points out, their techniques involve huge risks and they reward themselves too handsomely.

Financial services consulting is one of the focus areas of Bearing and I know many of our readers are interested in this topic. Enjoy the video! Some years ago, I wrote an article about the effect hedge funds have on the wider economy, which may also be interesting to read.

How Hedge Funds Make Money

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