HEDGE FUND - Tax Ninja's Word of the Week

Team Ninja   October 11, 2020

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Hedge Fund [ hej-fuhnd ]


  • Noun:

an investment partnership that uses high-risk, speculative methods to obtain large, short-term profits.

  • Financial Meaning:

To hedge means to safeguard, and in the context of investing, it means to protect against risks.

hedge fund is an investment fund that trades in relatively liquid assets and is able to make extensive use of more complex trading, portfolio-construction and risk management techniques to improve performance, such as short selling, leverage, and derivatives.

Hedge funds are generally seen as aggressive and risky, particularly when compared to mutual funds.


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