I ve started learning about the market but I dont know what hedge funds are. Please explain
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The original meaning was funds that try that try protect the assets of wealthy people by “hedging”, ie. Investing in one kind of stock or bond, and at the same time investing in something that might move in the opposite direction. So whichever way the market moves, the assets are somewhat protected.
Now it just means a large pool of money from wealthy private investors, and often it is used to try to take over companies, either to sell off their assets, or to force the company to take some action the hedge fund managers think will benefit their investors.
This is an activist approach to investing, while most of us are small time passive investors, who hope our investments do well, but have no real power to make that happen
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