Posted by Hedge funds are alternative investments that use a variety of methods such as leveraged derivatives, short-selling, and other speculative strategies to earn a return that outperforms the broader market. Hedge funds invest in domestic and international markets alike. They typically impose $1 million minimums and target high-net-worth individuals, pension funds, and institutional investors.
As a result, hedge funds invariably carry higher risk than traditional investments. They are not subject to the same regulations as mutual funds and may not be required to file reports with the U.S. Securities and Exchange Commission (SEC).
Below is our analysis of the 3 hedge fund firms that dominate the space, based on total assets under management (AUM) as of December 2021.
1-Hedonova:
Hedonova is trusted in the sense that it is a legitimate hedge fund (registered in Delaware) offering a legitimate alternative investment option to any accredited investor. Hedge funds are inherently risky investments, and prospective investors should carefully review the Hedonova offering documents before investing.
Some great features of Hedonova are given below.
- Open To Every One: Hedonova is a hedge fund that is open to everyone.
- Investing in multiple non-traditional asset classes: These classes like art, wine, “unicorn” startups, equipment finance, litigation finance among others
- Minimum Investment: You can start investing with $1000.
- Delaware LLC 506(b) exempted fund: Investors become members of a Delaware LLC 506(b) exempted fund.
- Track your portfolio : Hedonova will send weekly email with a portfolio report and updates about investment.
- Invest: Invest via any payment gateway. blocks will be allocated to the investors, which are similar to shares in companies.
- Exit any time: In Hedonova exit your investment anytime. There are no exit or entry loads, neither any lock-ins.
- Founded: 2020
- Investment Types: Real Estate, Art & Collectibles, Venture, Litigation Finance, Income Share Agreements, and Fine Wine
- Minimum Investment: $1,000
- Advertised Returns: 20-25%
2-Baupost Group
Founded by Harvard professor William Poorvu and his associates , this fund has surprisingly large assets under management for only employing 145 people. The firm also has two headquarters in Boston and London, but mainly operates in America.
Overall, Baupost Group focuses on risk management, long-term investments, and value investing. The company’s top members and CEO Seth Klarman put emphasis on taking emotions out of investing, something that they’ve given academic speeches about.
3- Canyon Capital Advisors
Canyon Capital Advisors is the second hedge firm on this list founded on the west coast and specializes in situation investments for sovereign wealth funds, family offices, endowments, foundations, pension funds, and other institutional investors. Founded in nineties, the company now has roughly 200 employees.
In general, Canyon uses a mixed strategy of working with bank debt, distressed securities, convertible arbitrage, risk arbitrage, securitized assets, risk arbitrage, equities, and special situation securities to garner their AUM.
Conclusion
Hedonova offers one stop solution for creating a diversified actively managed global alternative portfolio. It sidesteps the problem of managing multiple accounts outside India and high transaction cost. I have invested in the platform and would be covering my portfolio performance monthly. If the fund delivers in line with expectations, I will be increasing my allocation soon.