Question
Difference between hedge funds and mutual funds?
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29th Nov 2009 by cocacolabuffet
The key difference between hedge funds and mutual funds is the degree of regulations over these two institutions. There are sofar very little regulations over hedge funds while there are established relatively stricter regulations over mutual funds. For instance, hedge funds are free to choose whatever strategies and derivatives such as shorting stocks, trading options, futures, etc. Mutual funds are long only and are prohibited from trading derivatives.
Another important difference between hedge funds and mutual funds is the fee structure. Hedge funds charge performance or incentive-allocation fees as well as management fees whereas mutual funds charge only management fees.
The key difference between hedge funds and mutual funds is the degree of regulations over these two institutions. There are sofar very little regulations over hedge funds while there are established relatively stricter regulations over mutual funds. For instance, hedge funds are free to choose whatever strategies and derivatives such as shorting stocks, trading options, futures, etc. Mutual funds are long only and are prohibited from trading derivatives.
Another important difference between hedge funds and mutual funds is the fee structure. Hedge funds charge performance or incentive-allocation fees as well as management fees whereas mutual funds charge only management fees.
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9th Nov 2009 In Investing
1 Answers | 163 Views
Subjects: hedge funds,
mutual funds,