What do hedge funds actually do ? How do they make money ?
Hedge funds can be distinguished by other investment entities, as they
make money out of thin air.
Hedge funds apply strategies that are different than conventional investments :
• Arbitrage trading
• Buying distressed securities
• Pump and dump
• Market neutral
• Global macro
Their legal entity structure is similar to Private Equity funds - General-Limited Partnership model
Typically, they have a short-term horizon.