Grow wealth when risk is rewarded, protect it when it’s penalised.
The origins of investing can arguably be traced back to the 1700’s where Dutch merchants first began pooling capital, to access a wider and diversified opportunity set. Since then, the benefits of pooled investment vehicles have been applied in various ways to create many flexible investment propositions for the savvy investor.
Today, investors can pool assets in any of three regulated ways: Pooling to grow insurance premiums through a life license, collecting deposits through a banking license to invest, or pooling savings through a collective unit trust to earn investment growth. Regulated hedge funds are now pooled through the latter.
Many managers have demonstrated investment clarity when determining the value of hedge funds in the broad investment terrain. Understanding how each category of hedge fund investment style enhances an investors’ portfolio is a mandatory requirement for a hedge fund manager to navigate an ever expanding opportunity set.