What are funds of hedge funds?
Funds of hedge funds are widely regarded as comprising a distinct style group within the hedge fund industry. Funds of hedge funds offer investors a managed portfolio, which in turn, invests in multiple hedge funds that oftentimes pursue multiple investment strategies. The potential benefits of the fund of hedge funds approach are automatic diversification amongst strategies and managers, professional portfolio and risk management, possible entry into closed managers, ongoing evaluation and reporting, and smaller minimums that allow access to a greater number of managers with less exposure to each.
” A fund of hedge funds is an investment company that invests in hedge funds — rather than investing in individual securities. Some funds of hedge funds register their securities with the SEC. These funds of hedge funds must provide investors with a prospectus and must file certain reports quarterly with the SEC. Many registered funds of hedge funds have much lower investment minimums (e.g., $25,000) than individual hedge funds. Thus, some investors that would be unable to invest in a hedge fund directly may be able to purchase shares of registered funds of hedge funds. Back to Top Oil and Gas Ventures Some of the riskiest investments capitalize on current events and consumer fear. A prime example of this fraud concerns oil and gas ventures. In oil and gas ventures, con artists use the rising price of fuel and what investors learn of the news about wars and terrorism to make them believe there are easy gains to be made. Consumers should understand that even when an oil and gas opportu
