A fund, usually used by wealthy individuals and institutions, which is allowed to use Aggressive strategies that are unavailable to mutual Fund, including Selling short, leverage, Program trading, Swap, Arbitrage, and Derivative. Hedge funds are Exempt from many of the rules and regulations governing other mutual Fund, which allows them to accomplish Aggressive investing goals. They are restricted by law to no more than 100 investors per fund, and as a result most Hedge funds set extremely High minimum investment amounts, ranging anywhere from $250,000 to over $1 million. As with traditional mutual Fund, investors in Hedge funds pay a management fee;
however, Hedge funds also collect a percentage of the profits (usually 20%).
