The Hedge Fund Mentality

Hedge funds are typically seen as places where only the wealthy put their money, and this is a correct assumption. You need to have a net worth of over $1 million to legally be allowed to invest in a hedge fund, and this excludes the vast majority of us. However, just because we can’t invest our cash into a hedge fund does not mean that we cannot take a similar approach to trading with our own personal cash.
Using Hedge Fund Tactics
First, let’s look at what makes a hedge fund special. Hedge funds are private funds. They are designed to make cash in any type of market. And they often take unconventional approaches to make this happen. These funds can be comprised of stocks, but they are not limited to them. A lot of managers focus on currencies and commodities, too. Some focus solely on these things. The legal restrictions on these funds are much less because of the high barriers for entry into them. (more…)