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Sat12162017

Last updateSat, 29 Jul 2017 12am

Back You are here: Home Market Market Update Insight What is so unique about hedge funds?

What is so unique about hedge funds?

Apart from the fact that hedge funds could leverage and short sell the stock, one of key differentiation between hedge funds vs mutual funds would be their concentrated "bet" - hedge fund returns depend on the performance of a few key stocks. 

Typical hedge fund has 69% of its long-equity assets invested in its 10 largest positions.  For large-cap mutual fund, the top 10 would take up 33%; small cap mutual fund is 22%; S&P 500 18% and Russell 2000 index is 2% as shown below:

Source:

Business Insider, 2016-08-22, "Hedge Fund Managers are Waiting for the World to Change"