Basically the title. Hedge funds underperform every year as compared to broader ETFs like S&P500 by more than 10%! Given this, who invests in hedge funds? Are they stupid or am I stupid?
[https://www.aei.org/carpe-diem/the-sp-500-index-out-performed-hedge-funds-over-the-last-10-years-and-it-wasnt-even-close/](https://www.aei.org/carpe-diem/the-sp-500-index-out-performed-hedge-funds-over-the-last-10-years-and-it-wasnt-even-close/)
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A hedge fund is exactly as its name suggests. It is generally structured to hedge against market volatility. When the nether goes up it doesn’t appreciate as fast but when markets retreat, it preserves capital. It’s for folks who have a lot of money who want to hold on to it as opposed to most folks who are looking to grow their monies and need to take higher risks to get higher returns
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