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What Are You Really Getting When You Invest in a Hedge Fund?

by William Reichenstein

What Are You Really Getting When You Invest In A Hedge Fund? Splash image

Hedge funds are all the rage in the investment industry. Their historical returns look great. And best yet, their returns often are weakly correlated with the stock market—a feature that has helped their appeal in the 2000–2002 bear market. They are touted as a great asset class for adding diversification to a portfolio.

What a deal!

But, CAVEAT EMPTOR—buyer beware! If it looks too good to be true, it probably is.

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William Reichenstein , CFA, holds the Pat and Thomas R. Powers Chair in Investment Management at Baylor University and is head of research at Social Security Solutions, Inc .


Discussion

Mike Callahan from California posted 9 months ago:

Right on!


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