Published on: April 4th, 2022 • Duration: 11 minutes
In this Investor Tutorials mini-series, Jamie McDonald discusses hedge funds and their prominence in financial markets. McDonald explores hedge funds’ evolution from their origins in the 1980s and ’90s, including the proliferation of strategies as well as their raw growth as investment vehicles. The industry has seen some drastic changes along the way, not least in terms of regulation. But not even that has stopped hedge funds from reaching an estimated $4 trillion in total assets under management. As for influence on price action, SAC Capital is said to have once accounted for 3% of all shares traded on the New York Stock Exchange. McDonald also highlights the commercial aspects of hedge funds’ operations, in terms of the fees charged to investors as well as why brokers value their business so highly. By the end of this tutorial, you should have a comprehensive understanding of the hedge fund industry and how you can use some of their techniques in your own trading strategy.