{"id":9242,"date":"2025-11-21T17:12:48","date_gmt":"2025-11-21T09:12:48","guid":{"rendered":"https:\/\/www.linkwayshk.com\/?page_id=9242"},"modified":"2025-12-05T10:51:18","modified_gmt":"2025-12-05T02:51:18","slug":"investor-education-hedge-funds","status":"publish","type":"page","link":"https:\/\/www.linkwayshk.com\/?page_id=9242","title":{"rendered":"Hedge Funds"},"content":{"rendered":"\n<div class=\"wp-block-uagb-container uag-hide-tab uag-hide-mob uagb-block-ca5badf7 alignwide uagb-is-root-container\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uag-hide-tab uag-hide-mob uagb-block-db0d9ee6 alignwide uagb-is-root-container\">\n<h1 class=\"wp-block-heading has-ast-global-color-0-color has-text-color has-link-color with-text-shadow wp-elements-2007b3d29093291059203d88441590c4 core-heading core-heading-69fb34fd0dd0e\" style=\"padding-right:var(--wp--preset--spacing--80);padding-left:var(--wp--preset--spacing--80);font-size:64px\">INVESTOR<br>EDUCATION<\/h1>\n<\/div>\n\n\n\n<div class=\"wp-block-cover alignfull is-light has-custom-content-position is-position-center-left uag-hide-desktop has-aspect-ratio\" style=\"padding-top:240px;padding-bottom:120px;min-height:100vh;aspect-ratio:auto;min-height:unset;\"><img loading=\"lazy\" decoding=\"async\" width=\"1280\" height=\"410\" class=\"wp-block-cover__image-background wp-image-7733 size-full\" alt=\"\" src=\"https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/09\/edu.png\" style=\"object-position:50% 50%\" data-object-fit=\"cover\" data-object-position=\"50% 50%\" srcset=\"https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/09\/edu.png 1280w, https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/09\/edu-300x96.png 300w, https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/09\/edu-1024x328.png 1024w, https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/09\/edu-768x246.png 768w\" sizes=\"auto, (max-width: 1280px) 100vw, 1280px\" \/><span aria-hidden=\"true\" class=\"wp-block-cover__background has-background-dim-0 has-background-dim\"><\/span><div class=\"wp-block-cover__inner-container is-layout-flow wp-block-cover-is-layout-flow\">\n<h1 class=\"wp-block-heading has-ast-global-color-0-color has-text-color with-text-shadow core-heading core-heading-69fb34fd0e071\" style=\"font-size:36px\">INVESTOR<br>EDUCATION<\/h1>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uag-hide-tab uag-hide-mob uagb-block-a7bd50e9 alignwide uagb-is-root-container\">\n<div class=\"wp-block-uagb-container uagb-block-9a0d957f alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-block-d2e01c17 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-block-d7c12ed8\">\n<div class=\"wp-block-uagb-info-box uagb-block-82d4e14d uagb-infobox__content-wrap  uagb-infobox-icon-above-title uagb-infobox-image-valign-top wp-block-uagb-info-box--has-margin\"><div class=\"uagb-infobox-margin-wrapper\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">Hedge Funds<\/h3><\/div><\/div><\/div><\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-0e5b568c\">\n<div class=\"wp-block-uagb-image alignleft uagb-block-b8a76e94 wp-block-uagb-image--layout-default wp-block-uagb-image--effect-static wp-block-uagb-image--align-left\"><figure class=\"wp-block-uagb-image__figure\"><img decoding=\"async\" srcset=\"https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/08\/image-1.png ,https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/08\/image-1.png 780w, https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/08\/image-1-1024x115.png 360w\" sizes=\"auto, (max-width: 480px) 150px\" src=\"https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/08\/image-1.png\" alt=\"\" class=\"uag-image-6998\" width=\"700\" height=\"60\" title=\"\" loading=\"lazy\" role=\"img\"\/><\/figure><\/div>\n<\/div>\n<\/div><\/div>\n<\/div><\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uag-hide-tab uag-hide-mob uagb-block-279e3cb3 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-block-f0c7087f\">\n<div class=\"wp-block-uagb-container uagb-block-77a0593e\">\n<div class=\"wp-block-uagb-container uagb-block-75f0caf5 default uagb-is-root-container\">\n<div class=\"wp-block-uagb-separator uagb-block-3f5eae7d\"><div class=\"uagb-separator-spacing-wrapper\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-6225fbf2\">\n<div class=\"wp-block-uagb-separator uagb-block-c2a53788\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-9275314a\">\n<div class=\"wp-block-uagb-container uagb-block-4d559920\">\n<div class=\"wp-block-group is-nowrap is-layout-flex wp-container-core-group-is-layout-6c531013 wp-block-group-is-layout-flex\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-6f6e9b45 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-block-6e9c3df2\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-c321c088\">\n<div class=\"wp-block-uagb-info-box uagb-block-0face7e8 uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">What is Hedge Fund?<\/h3><\/div><\/div><\/div>\n<\/div>\n<\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-c083df13\">\n<div class=\"wp-block-uagb-info-box uagb-block-085c7f3a uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\">\n<div class=\"uagb-ifb-content\">\n<div class=\"uagb-ifb-title-wrap\">No standard definition:<\/div>\n<ul>\n<li><p class=\"uagb-ifb-desc\">Ability to short the market, to leverage the portfolio to multiply gains, and to hold high concentrations of positions.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">No industry-wide classifications of hedge fund strategies, each major industry group has its own classification system.<\/p><\/li>\n<\/ul>\n<div class=\"uagb-ifb-title-wrap\">Distinct characteristics of hedge funds:<\/div>\n<ul>\n<li><p class=\"uagb-ifb-desc\">Key performance driver is manager skill rather than market returns.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Target consistent returns in the long term rather than outperformance of a benchmark index.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Managers are unrestricted in their choice of investment strategies.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">The ability to invest in any asset class or instrument.<\/p><\/li>\n<\/ul>\n<div class=\"uagb-ifb-title-wrap\">Attractions:<\/div>\n<ul>\n<li><p class=\"uagb-ifb-desc\">Expectation of strong returns (historical data).<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Low correlations to traditional asset classes and ability to provide diversification.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Target absolute returns rather than relative return.<\/p><\/li>\n<\/ul>\n<\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-8f237b81\">\n<div class=\"wp-block-uagb-container uagb-block-e0ef907a\">\n<div class=\"wp-block-uagb-container uagb-block-3616f0dc default uagb-is-root-container\">\n<div class=\"wp-block-uagb-separator uagb-block-b069a6ef\"><div class=\"uagb-separator-spacing-wrapper\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-69e26b47\">\n<div class=\"wp-block-uagb-separator uagb-block-f15ea776\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-346bf367\">\n<div class=\"wp-block-uagb-container uagb-block-93b408e4\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-3f3bbb9d alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-block-ec53f8da\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-737d6890\">\n<div class=\"wp-block-uagb-info-box uagb-block-c535b0ac uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">Difference Between Mutual Fund and Hedge Fund<\/h3><\/div><\/div><\/div>\n<\/div>\n<\/div><\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-bdc8e373\">\n<div class=\"wp-block-uagb-container uagb-block-aeb8c7ff alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-info-box uagb-block-5eb2a47d uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\">\n    <div class=\"uagb-ifb-content\">\n        <div class=\"uagb-ifb-title-wrap\"><\/div>\n<p class=\"uagb-ifb-desc\" style=\"color: var(--ast-global-color-0);text-decoration: underline;\">Authorization<\/p>\n<p class=\"uagb-ifb-desc\">A mutual fund is usually authorized by authorties, and can be sold to an unlimited number of investors. Most hedge funds are not authorized and can only be sold to carefully defined sophisticated investors. Mutual funds may advertise freely; hedge funds may not.<\/p>\n<p class=\"uagb-ifb-desc\" style=\"color: var(--ast-global-color-0);text-decoration: underline;\">Flexibility<\/p>\n<p class=\"uagb-ifb-desc\">The hedge fund manager has fewer constraints to deal with; he can sell short, use derivatives, and use leverage. The manager can also make significant changes to the strategy if he thinks it is appropriate. The mutual fund manager cannot be as flexible.<\/p>\n<p class=\"uagb-ifb-desc\" style=\"color: var(--ast-global-color-0);text-decoration: underline;\">Liquidity<\/p>\n<p class=\"uagb-ifb-desc\">The mutual fund often offers daily liquidity (you can withdraw at any time); the hedge fund usually has some sort of \u201clockup\u201d provision. You can only get your money periodically<\/p>\n<p class=\"uagb-ifb-desc\" style=\"color: var(--ast-global-color-0);text-decoration: underline;\">Absolute vs. Relative<\/p>\n<p class=\"uagb-ifb-desc\">The hedge fund aims for absolute return (it wants to produce positive returns regardless of what the market is doing); the mutual fund is usually managed relative to an index benchmark and is judged on its variance from that benchmark.<\/p>\n<p class=\"uagb-ifb-desc\" style=\"color: var(--ast-global-color-0);text-decoration: underline;\">Self-Investment<\/p>\n<p class=\"uagb-ifb-desc\">The hedge fund manager is expected to put some of his own capital at risk in the strategy. The mutual fund does not face this same expectation.<\/p>\n        <\/p>\n    <\/div>\n<\/div>\n<\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-9d0d4035\">\n<div class=\"wp-block-uagb-container uagb-block-d6526d31\">\n<div class=\"wp-block-uagb-container uagb-block-e0cc5c55 default uagb-is-root-container\">\n<div class=\"wp-block-uagb-separator uagb-block-e3d55f74\"><div class=\"uagb-separator-spacing-wrapper\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-de3531cc\">\n<div class=\"wp-block-uagb-separator uagb-block-9693134d\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-9b89bea1\">\n<div class=\"wp-block-uagb-container uagb-block-1b2205a6\">\n<div class=\"wp-block-group is-nowrap is-layout-flex wp-container-core-group-is-layout-6c531013 wp-block-group-is-layout-flex\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-da55445e alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-block-ec4bea82\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-283308da\">\n<div class=\"wp-block-uagb-info-box uagb-block-4379b23a uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">Fees Paid to Hedge Fund<\/h3><\/div><\/div><\/div>\n<\/div>\n<\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-f12aa9d4\">\n<div class=\"wp-block-uagb-info-box uagb-block-085c7f3a uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\">\n<div class=\"uagb-ifb-content\">\n<ul>\n<li><p class=\"uagb-ifb-desc\">Hedge fund typically charge both a management fee and a performance fee.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Management fees are calculated as a percentage of the fund&#8217;s net asset value and typically range from 1% to 4% per annum, with 2% being standard.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">The performance fee is typically 20% of the fund&#8217;s return during any year, though they range between 10% and 50%. Performance fees are intended to provide an incentive for a manager to generate profits.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Almost all hedge fund performance fees include a &#8220;high water mark&#8221; (or &#8220;loss carryforward provision&#8221;), which means that the performance fee only applies to net profits (i.e., profits after losses in previous years have been recovered).<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Some performance fees include a &#8220;hurdle&#8221;, so that a fee is only paid on the fund&#8217;s performance in excess of a benchmark rate (e.g. LIBOR) or a fixed percentage. A hurdle is intended to ensure that a manager is only rewarded if the fund generates returns in excess of the returns that the investor would have received if they had invested their money elsewhere.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Some hedge funds charge a redemption fee (or withdrawal fee) for early withdrawals during a specified period of time (typically a year). The purpose of the fee is to discourage short-term investing, reduce turnover and deter withdrawals after periods of poor performance.<\/p><\/li>\n<\/ul>\n<\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-c3407cd1\">\n<div class=\"wp-block-uagb-container uagb-block-5d54369e\">\n<div class=\"wp-block-uagb-container uagb-block-3bc64b68 default uagb-is-root-container\">\n<div class=\"wp-block-uagb-separator uagb-block-d23ae245\"><div class=\"uagb-separator-spacing-wrapper\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-92e82753\">\n<div class=\"wp-block-uagb-separator uagb-block-9ef27a40\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-4eb86f39\">\n<div class=\"wp-block-uagb-container uagb-block-67614b96\">\n<div class=\"wp-block-group is-nowrap is-layout-flex wp-container-core-group-is-layout-6c531013 wp-block-group-is-layout-flex\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-fbcb9f95 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-block-69daef61\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-7624dc68\">\n<div class=\"wp-block-uagb-info-box uagb-block-c8f9455f uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">Side Pockets<\/h3><\/div><\/div><\/div>\n<\/div>\n<\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-a9c55e80\">\n<div class=\"wp-block-uagb-info-box uagb-block-085c7f3a uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\">\n<div class=\"uagb-ifb-content\">\n<ul>\n<li><p class=\"uagb-ifb-desc\">A side pocket is a mechanism whereby a fund compartmentalizes assets that are relatively illiquid or difficult to value reliably. When an investment is side-pocketed, its value is calculated separately from the value of the fund\u2019s main portfolio.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Because side pockets are used to hold illiquid investments, investors do not have the standard redemption rights with respect to the side pocket investment.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Profits or losses from the investment are allocated on a pro rata basis only to those who are investors at the time the investment is placed into the side pocket and are not shared with new investors.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Funds typically carry side pocket assets &#8220;at cost&#8221; for purposes of calculating management fees and reporting net asset values. This allows fund managers to avoid attempting a valuation of the underlying investments, which may not always have a readily available market value.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Side pockets allowed fund managers to lay away illiquid securities until market liquidity improved, a move that reduced losses. Despite these benefits, some investors complained that the practice was abused and not always transparent.<\/p><\/li>\n<\/ul>\n<\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-1dbfa9b2\">\n<div class=\"wp-block-uagb-container uagb-block-90ee473c\">\n<div class=\"wp-block-uagb-container uagb-block-705539c2 default uagb-is-root-container\">\n<div class=\"wp-block-uagb-separator uagb-block-767463ac\"><div class=\"uagb-separator-spacing-wrapper\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-51c43e25\">\n<div class=\"wp-block-uagb-separator uagb-block-61f67067\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-a30e3e3b\">\n<div class=\"wp-block-uagb-container uagb-block-626ee35d\">\n<div class=\"wp-block-group is-nowrap is-layout-flex wp-container-core-group-is-layout-6c531013 wp-block-group-is-layout-flex\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-76a39f03 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-block-c78dcbea\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-8c01da4b\">\n<div class=\"wp-block-uagb-info-box uagb-block-3ea99a69 uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">Types of Hedge Fund<\/h3><\/div><\/div><\/div>\n<\/div>\n<\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-1c1def7d\">\n<div class=\"wp-block-uagb-info-box uagb-block-085c7f3a uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\">\n<div class=\"uagb-ifb-content\">\n<ul>\n<li><p class=\"uagb-ifb-desc\">Market Trend (Directional \/ Tactical) Strategies Hedge Funds<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Event Driven Strategies Hedge Funds<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Arbitrage Strategies Hedge Funds<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Quant Funds<\/p><\/li>\n<\/ul>\n<\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-93d5a4b9\">\n<div class=\"wp-block-uagb-container uagb-block-18c25d51\">\n<div class=\"wp-block-uagb-container uagb-block-f246a6f6 default uagb-is-root-container\">\n<div class=\"wp-block-uagb-separator uagb-block-a056cbd1\"><div class=\"uagb-separator-spacing-wrapper\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-712b85ef\">\n<div class=\"wp-block-uagb-separator uagb-block-f55a88f6\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-9aad4283\">\n<div class=\"wp-block-uagb-container uagb-block-fd4e7fd2\">\n<div class=\"wp-block-group is-nowrap is-layout-flex wp-container-core-group-is-layout-6c531013 wp-block-group-is-layout-flex\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-54bde2d9 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-block-0c3c0741\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-5bfd6dc6\">\n<div class=\"wp-block-uagb-info-box uagb-block-de24f6b1 uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">Hedge Fund Key Risk Factors<\/h3><\/div><\/div><\/div>\n<\/div>\n<\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-f86508f4\">\n<div class=\"wp-block-uagb-info-box uagb-block-085c7f3a uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\">\n<div class=\"uagb-ifb-content\">\n<ul>\n<li><p class=\"uagb-ifb-desc\">A Hedge Fund may employ a distinctive strategy which may not have a readily ascertainable comparative benchmark or index.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Hedge Fund documents are not reviewed or approved by regulators.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Hedge Funds may be leveraged (including highly leveraged) and a Hedge Fund performance may be volatile.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Hedge Funds may use benchmarks or targets for measurement purposes. There is no guarantee that a Hedge Funds&#8217; goals, objectives, benchmarks or targeted returns will be achieved or reached.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Hedge Funds may have little or no operating history or performance and may use hypothetical or pro forma performance which may not reflect actual trading done by the manager or advisor and such history or performance should be reviewed carefully.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">A Hedge Fund is not required to provide periodic pricing or valuation information to investors and it may be the Hedge Fund&#8217;s practice to not provide such information.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Some Hedge Funds may use a single advisor or employ a single strategy, which could mean a lack of diversification and higher risk.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">An investment in a Hedge Fund may be illiquid and there may be significant restrictions on transferring interests in a Hedge Fund. There is no secondary market for an investor&#8217;s investment in a Hedge Fund and none is expected to develop.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">A Hedge Fund&#8217;s fees and expenses, which may be substantial regardless of any positive return, will offset the Fund&#8217;s trading profits.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">A Hedge Fund may involve a complex tax structure (which should be reviewed carefully) and delays in distributing important tax information.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">A Hedge Fund may not provide any transparency regarding its underlying investments (including sub-funds in a Fund of Funds structure) to investors. In such a case, there will be no way for an investor to discover or monitor the specific investments made by the Hedge Fund or, in a Fund of Funds structure, to know whether the sub-fund investments are consistent with the Hedge Fund\u2019s investment strategy or risk parameters.<\/p><\/li>\n<\/ul>\n<\/div><\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-b81d0d25 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-block-44189d76\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-c87e0730\">\n<div class=\"wp-block-uagb-info-box uagb-block-6ce70c87 uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><\/div><p class=\"uagb-ifb-desc\">For the basic knowledge and trading mechanism of Hedge Funds, please refer to the <a href=\"https:\/\/www.ifec.org.hk\/web\/en\/investment\/investment-products\/funds\/index.page\" target=\"_blank\" rel=\"noreferrer noopener\">information provided by Investor and Financial Education Council<\/a>. You should pay careful attention to the Liability Statement section on the homepage of the website of The IFEC at (<a href=\"https:\/\/www.ifec.org.hk\" target=\"_blank\" rel=\"noreferrer noopener\"><u>www.ifec.org.hk<\/u><\/a>)&nbsp;when referring to information using this link.<\/p><\/div><\/div>\n<\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-923b71a7\">\n<div class=\"wp-block-uagb-container uagb-block-fd66e579\">\n<div class=\"wp-block-uagb-container uagb-block-d6033957 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-separator uagb-block-64ac8ed6\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div>\n<\/div><\/div>\n<\/div>\n<\/div>\n<\/div><\/div>\n\n\n\n<div id=\"11\" class=\"wp-block-group has-ast-global-color-5-background-color has-background uag-hide-desktop is-content-justification-center is-layout-constrained wp-container-core-group-is-layout-f4258130 wp-block-group-is-layout-constrained\" style=\"min-height:200px;padding-top:10px;padding-bottom:0\">\n<div class=\"wp-block-uagb-container uagb-block-8c6a5818 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-info-box uagb-block-4b918c31 uagb-infobox__content-wrap  uagb-infobox-icon-above-title uagb-infobox-image-valign-top wp-block-uagb-info-box--has-margin\"><div class=\"uagb-infobox-margin-wrapper\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">Hedge Funds<\/h3><\/div><\/div><\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-image alignleft uagb-block-604e44dd wp-block-uagb-image--layout-default wp-block-uagb-image--effect-static wp-block-uagb-image--align-left\"><figure class=\"wp-block-uagb-image__figure\"><img decoding=\"async\" srcset=\"https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/08\/image-1.png ,https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/08\/image-1.png 780w, https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/08\/image-1-1024x115.png 360w\" sizes=\"auto, (max-width: 480px) 150px\" src=\"https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/08\/image-1.png\" alt=\"\" class=\"uag-image-6998\" width=\"500\" height=\"60\" title=\"\" loading=\"lazy\" role=\"img\"\/><\/figure><\/div>\n<\/div><\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-group alignfull has-ast-global-color-5-background-color has-background uag-hide-desktop is-content-justification-center is-layout-constrained wp-container-core-group-is-layout-ac259802 wp-block-group-is-layout-constrained\" id=\"11\" style=\"min-height:418px;padding-top:0px;padding-bottom:30px\">\n<div class=\"wp-block-uagb-container uagb-block-b34c54e2 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-db91a659 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-ffcf7e6c\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-8ff43407\">\n<div class=\"wp-block-uagb-info-box uagb-block-9976e3fd uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">What is Hedge Fund?<\/h3><\/div><\/div><\/div>\n<\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-info-box uagb-block-085c7f3a uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\">\n<div class=\"uagb-ifb-content\">\n<div class=\"uagb-ifb-title-wrap\">No standard definition:<\/div>\n<ul>\n<li><p class=\"uagb-ifb-desc\">Ability to short the market, to leverage the portfolio to multiply gains, and to hold high concentrations of positions.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">No industry-wide classifications of hedge fund strategies, each major industry group has its own classification system.<\/p><\/li>\n<\/ul>\n<div class=\"uagb-ifb-title-wrap\">Distinct characteristics of hedge funds:<\/div>\n<ul>\n<li><p class=\"uagb-ifb-desc\">Key performance driver is manager skill rather than market returns.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Target consistent returns in the long term rather than outperformance of a benchmark index.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Managers are unrestricted in their choice of investment strategies.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">The ability to invest in any asset class or instrument.<\/p><\/li>\n<\/ul>\n<div class=\"uagb-ifb-title-wrap\">Attractions:<\/div>\n<ul>\n<li><p class=\"uagb-ifb-desc\">Expectation of strong returns (historical data).<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Low correlations to traditional asset classes and ability to provide diversification.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Target absolute returns rather than relative return.<\/p><\/li>\n<\/ul>\n<\/div><\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-separator uagb-block-8ada7cbd\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-37722e50 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-bce78dbb alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-890714eb\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-41dc6ef9\">\n<div class=\"wp-block-uagb-info-box uagb-block-cf0b72c9 uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">Difference Between Mutual Fund and Hedge Fund<\/h3><\/div><\/div><\/div>\n<\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-info-box uagb-block-5eb2a47d uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\">\n    <div class=\"uagb-ifb-content\">\n        <div class=\"uagb-ifb-title-wrap\"><\/div>\n<p class=\"uagb-ifb-desc\" style=\"color: var(--ast-global-color-0);text-decoration: underline;\">Authorization<\/p>\n<p class=\"uagb-ifb-desc\">A mutual fund is usually authorized by authorties, and can be sold to an unlimited number of investors. Most hedge funds are not authorized and can only be sold to carefully defined sophisticated investors. Mutual funds may advertise freely; hedge funds may not.<\/p>\n<p class=\"uagb-ifb-desc\" style=\"color: var(--ast-global-color-0);text-decoration: underline;\">Flexibility<\/p>\n<p class=\"uagb-ifb-desc\">The hedge fund manager has fewer constraints to deal with; he can sell short, use derivatives, and use leverage. The manager can also make significant changes to the strategy if he thinks it is appropriate. The mutual fund manager cannot be as flexible.<\/p>\n<p class=\"uagb-ifb-desc\" style=\"color: var(--ast-global-color-0);text-decoration: underline;\">Liquidity<\/p>\n<p class=\"uagb-ifb-desc\">The mutual fund often offers daily liquidity (you can withdraw at any time); the hedge fund usually has some sort of \u201clockup\u201d provision. You can only get your money periodically<\/p>\n<p class=\"uagb-ifb-desc\" style=\"color: var(--ast-global-color-0);text-decoration: underline;\">Absolute vs. Relative<\/p>\n<p class=\"uagb-ifb-desc\">The hedge fund aims for absolute return (it wants to produce positive returns regardless of what the market is doing); the mutual fund is usually managed relative to an index benchmark and is judged on its variance from that benchmark.<\/p>\n<p class=\"uagb-ifb-desc\" style=\"color: var(--ast-global-color-0);text-decoration: underline;\">Self-Investment<\/p>\n<p class=\"uagb-ifb-desc\">The hedge fund manager is expected to put some of his own capital at risk in the strategy. The mutual fund does not face this same expectation.<\/p>\n        <\/p>\n    <\/div>\n<\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-separator uagb-block-a8a1cb42\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-71d39878 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-c3b05b62 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-fbfb3051\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-530abfbc\">\n<div class=\"wp-block-uagb-info-box uagb-block-206108bd uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">Fees Paid to Hedge Fund<\/h3><\/div><\/div><\/div>\n<\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-info-box uagb-block-085c7f3a uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\">\n<div class=\"uagb-ifb-content\">\n<ul>\n<li><p class=\"uagb-ifb-desc\">Hedge fund typically charge both a management fee and a performance fee.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Management fees are calculated as a percentage of the fund&#8217;s net asset value and typically range from 1% to 4% per annum, with 2% being standard.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">The performance fee is typically 20% of the fund&#8217;s return during any year, though they range between 10% and 50%. Performance fees are intended to provide an incentive for a manager to generate profits.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Almost all hedge fund performance fees include a &#8220;high water mark&#8221; (or &#8220;loss carryforward provision&#8221;), which means that the performance fee only applies to net profits (i.e., profits after losses in previous years have been recovered).<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Some performance fees include a &#8220;hurdle&#8221;, so that a fee is only paid on the fund&#8217;s performance in excess of a benchmark rate (e.g. LIBOR) or a fixed percentage. A hurdle is intended to ensure that a manager is only rewarded if the fund generates returns in excess of the returns that the investor would have received if they had invested their money elsewhere.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Some hedge funds charge a redemption fee (or withdrawal fee) for early withdrawals during a specified period of time (typically a year). The purpose of the fee is to discourage short-term investing, reduce turnover and deter withdrawals after periods of poor performance.<\/p><\/li>\n<\/ul>\n<\/div><\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-separator uagb-block-2487ddda\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-aa4af0e4 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-2f158760 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-2b4bbfa2\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-81d4f9c4\">\n<div class=\"wp-block-uagb-info-box uagb-block-15cf7d54 uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">Side Pockets<\/h3><\/div><\/div><\/div>\n<\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-info-box uagb-block-085c7f3a uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\">\n<div class=\"uagb-ifb-content\">\n<ul>\n<li><p class=\"uagb-ifb-desc\">A side pocket is a mechanism whereby a fund compartmentalizes assets that are relatively illiquid or difficult to value reliably. When an investment is side-pocketed, its value is calculated separately from the value of the fund\u2019s main portfolio.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Because side pockets are used to hold illiquid investments, investors do not have the standard redemption rights with respect to the side pocket investment.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Profits or losses from the investment are allocated on a pro rata basis only to those who are investors at the time the investment is placed into the side pocket and are not shared with new investors.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Funds typically carry side pocket assets &#8220;at cost&#8221; for purposes of calculating management fees and reporting net asset values. This allows fund managers to avoid attempting a valuation of the underlying investments, which may not always have a readily available market value.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Side pockets allowed fund managers to lay away illiquid securities until market liquidity improved, a move that reduced losses. Despite these benefits, some investors complained that the practice was abused and not always transparent.<\/p><\/li>\n<\/ul>\n<\/div><\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-separator uagb-block-16f38dc7\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-9356fcd6 alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-61f5674c alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-726f0935\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-0d880588\">\n<div class=\"wp-block-uagb-info-box uagb-block-41804036 uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">Types of Hedge Fund<\/h3><\/div><\/div><\/div>\n<\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-info-box uagb-block-085c7f3a uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\">\n<div class=\"uagb-ifb-content\">\n<ul>\n<li><p class=\"uagb-ifb-desc\">Market Trend (Directional \/ Tactical) Strategies Hedge Funds<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Event Driven Strategies Hedge Funds<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Arbitrage Strategies Hedge Funds<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Quant Funds<\/p><\/li>\n<\/ul>\n<\/div><\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-separator uagb-block-31d81c8e\"><div class=\"wp-block-uagb-separator__inner\" style=\"--my-background-image:\"><\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-038baa2c alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-8078f8ea alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-container uagb-layout-flex uagb-block-f76c5719\"><\/div>\n\n\n\n<div class=\"wp-block-uagb-container uagb-block-428eb40e\">\n<div class=\"wp-block-uagb-info-box uagb-block-ccebe9e9 uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><h3 class=\"uagb-ifb-title\">Hedge Fund Key Risk Factors<\/h3><\/div><\/div><\/div>\n<\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-info-box uagb-block-085c7f3a uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\">\n<div class=\"uagb-ifb-content\">\n<ul>\n<li><p class=\"uagb-ifb-desc\">A Hedge Fund may employ a distinctive strategy which may not have a readily ascertainable comparative benchmark or index.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Hedge Fund documents are not reviewed or approved by regulators.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Hedge Funds may be leveraged (including highly leveraged) and a Hedge Fund performance may be volatile.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Hedge Funds may use benchmarks or targets for measurement purposes. There is no guarantee that a Hedge Funds&#8217; goals, objectives, benchmarks or targeted returns will be achieved or reached.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Hedge Funds may have little or no operating history or performance and may use hypothetical or pro forma performance which may not reflect actual trading done by the manager or advisor and such history or performance should be reviewed carefully.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">A Hedge Fund is not required to provide periodic pricing or valuation information to investors and it may be the Hedge Fund&#8217;s practice to not provide such information.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">Some Hedge Funds may use a single advisor or employ a single strategy, which could mean a lack of diversification and higher risk.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">An investment in a Hedge Fund may be illiquid and there may be significant restrictions on transferring interests in a Hedge Fund. There is no secondary market for an investor&#8217;s investment in a Hedge Fund and none is expected to develop.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">A Hedge Fund&#8217;s fees and expenses, which may be substantial regardless of any positive return, will offset the Fund&#8217;s trading profits.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">A Hedge Fund may involve a complex tax structure (which should be reviewed carefully) and delays in distributing important tax information.<\/p><\/li>\n<li><p class=\"uagb-ifb-desc\">A Hedge Fund may not provide any transparency regarding its underlying investments (including sub-funds in a Fund of Funds structure) to investors. In such a case, there will be no way for an investor to discover or monitor the specific investments made by the Hedge Fund or, in a Fund of Funds structure, to know whether the sub-fund investments are consistent with the Hedge Fund\u2019s investment strategy or risk parameters.<\/p><\/li>\n<\/ul>\n<\/div><\/div>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-uagb-info-box uagb-block-484b397f uagb-infobox__content-wrap  uagb-infobox-icon-left uagb-infobox-left uagb-infobox-image-valign-top\"><div class=\"uagb-ifb-content\"><div class=\"uagb-ifb-title-wrap\"><\/div><p class=\"uagb-ifb-desc\">For the basic knowledge and trading mechanism of Hedge Funds, please refer to the <a href=\"https:\/\/www.ifec.org.hk\/web\/en\/investment\/investment-products\/funds\/index.page\" target=\"_blank\" rel=\"noreferrer noopener\">information provided by Investor and Financial Education Council<\/a>. You should pay careful attention to the Liability Statement section on the homepage of the website of The IFEC at (<a href=\"https:\/\/www.ifec.org.hk\" target=\"_blank\" rel=\"noreferrer noopener\"><u>www.ifec.org.hk<\/u><\/a>)&nbsp;when referring to information using this link.<\/p><\/div><\/div>\n\n\n\n<div class=\"wp-block-columns is-layout-flex wp-container-core-columns-is-layout-28f84493 wp-block-columns-is-layout-flex\">\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<div class=\"wp-block-uagb-container uagb-block-d5f07d3d alignfull uagb-is-root-container\"><div class=\"uagb-container-inner-blocks-wrap\">\n<div class=\"wp-block-uagb-image aligncenter uagb-block-6dd0238e wp-block-uagb-image--layout-default wp-block-uagb-image--effect-static wp-block-uagb-image--align-center\"><figure class=\"wp-block-uagb-image__figure\"><img decoding=\"async\"  sizes=\"auto, (max-width: 480px) 150px\" src=\"https:\/\/www.linkwayshk.com\/wp-content\/uploads\/2025\/07\/\u5c0f\u76f4\u7ebf05_.png\" alt=\"\" width=\"1280\" height=\"3\" title=\"\" loading=\"lazy\" role=\"img\"\/><\/figure><\/div>\n<\/div><\/div>\n<\/div>\n<\/div>\n<\/div>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>INVESTOREDUCATION No standard definition: Ability to sh &hellip;<\/p>\n<p class=\"read-more\"> <a class=\"\" href=\"https:\/\/www.linkwayshk.com\/?page_id=9242\"> <span class=\"screen-reader-text\">Hedge Funds<\/span> \u95b1\u8b80\u5168\u6587 &raquo;<\/a><\/p>\n","protected":false},"author":3,"featured_media":0,"parent":8936,"menu_order":35,"comment_status":"closed","ping_status":"closed","template":"","meta":{"_uag_custom_page_level_css":"body {\n    font-family: SimHei, sans-serif;\n}\nheader {\n    position: fixed !important;\n    width: 100% !important;\n}\nol, ul {\n    margin: 0 0 0 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center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"footnotes":""},"class_list":["post-9242","page","type-page","status-publish","hentry"],"uagb_featured_image_src":{"full":false,"thumbnail":false,"medium":false,"medium_large":false,"large":false,"1536x1536":false,"2048x2048":false},"uagb_author_info":{"display_name":"itstaff","author_link":"https:\/\/www.linkwayshk.com\/?author=3"},"uagb_comment_info":0,"uagb_excerpt":"INVESTOREDUCATION No standard definition: Ability to 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