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To: FR Class of 1998

” . . .normally people who invest in a hedge expect to lose that money.”
That’s a baseless claim without a word of truth in it. Multi-millionaires don’t invest with the expectation of losing money.


14 posted on 02/15/2008 5:22:07 AM PST by em2vn
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To: em2vn

In a financial context, a hedge is by definition a position against one of one’s major positions. If you win on your hedge, it means you lost on your major position. Thus a hedge is an insurance policy. It is literally “hedging a bet”.

A person who invests in a hedge fund without an opposite position is a speculator whose methods are akin to piracy, and for whom no tears are warranted.


16 posted on 02/15/2008 5:28:47 AM PST by FR Class of 1998 (Government vending: Insert Paycheck and Press '4' for English)
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