Participants in hedge funds, Financial Management

Participants in Hedge Funds:

The Sponsor and the Investors

Sponsors are promoters and generally, they hold a profit share on percentage for the capital invested in the Fund. In limited partnerships, they are the general partners and usually receive an allocation of income on the Fund based on performance. General partners also act as intermediaries for investors in Hedge Fund industry. They invest the Fund collected from investors based upon investment strategies to maximize returns.

Generally, investors in Hedge Fund industry are persons or institutions willing to take high risk for high returns. The largest category of investors in Hedge Funds comprises retail and high networth individuals. According to estimates, they contribute about 75 percent of the total assets managed in the Hedge Fund universe. Others who are increasing their investment activities in Hedge Funds are pension funds, endowment funds, fund of Hedge Funds, etc. According to the Securities Exchange Commission (SEC), US guidelines, the minimum level of networth for investment in the Hedge Funds for investors is $1 million. This limit is necessary to qualify them as ‘accredited investor', to participate in Hedge Funds. The limit for investment in Hedge funds for corporations, trusts, and other institutions is $5 million in networth and total assets of $25 million. Percentage of institutional and investors allocating capital to hedge funds for the years 2003 and 2005

 

Posted Date: 9/11/2012 2:09:27 AM | Location : United States







Related Discussions:- Participants in hedge funds, Assignment Help, Ask Question on Participants in hedge funds, Get Answer, Expert's Help, Participants in hedge funds Discussions

Write discussion on Participants in hedge funds
Your posts are moderated
Related Questions
You are required to choose a company for analysis.  This company should be quoted on one of the principal international exchanges.  It may be your own company.  You should then do

Question 1 What are the limitations of management accounting? Question 2 Explain the significance of financial analysis Question 3 What are the advantages of the value a

Q. What do you understand by Business cycle? Business cycle: business cycle refers to the alternate expansion and contraction in the general business activity. in a period of t

Bonds issued by the government are termed as treasury bonds. For example, dated securities issued by the government. These bonds are normally issued for longer ma

Q. What are the Benefits of Holding Inventories? (1) Timing of Demand and Supply: - Requirement to hold inventory of raw materials arises because it isn't possible for a firm

For the purpose of the assignment, ASSUME that you are the most senior financial officer in the firm, and has responsibility for treasury. In its financial advisory capacity, you h

Explain the flow of goods and paper work in Diagram on Page 74 Ed. 10 [P. 70  in Ed. 9] of your textbook.  Explain a.  how the transaction would work without a Letter of Credi

Goral is required to pay five equal annual payments of Rs. 10,000 each in his deposit account that pays 10% interest per year. Find out the future value of annuity at the end of fi

Why do you think closed-end country funds frequently trade at a premium or discount? Answer:  CECFs (closed-end country funds) trade at a premium or discount since capital market

Q. Estimation of Working Capital? A firm must estimate in advance as to how much net working capital will be required for the smooth operations of the business. Only then, it c