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Hedge Funds Open to Ordinary Investors

This article was written by in Investing. 4 comments.


Earlier this month, I presented an introduction to hedge funds. Today, CNN is reporting that hedge fund managers want to repair their image among the investing public.

In an attempt to do so, some mutual fund companies are set to bring hedge-like funds to everyday investors. One such fund is the DB Hedge Strategies Fund. This fund will charge a 1.95 percent annual fee and a 0.25 percent administrative fee. That’s less than some actively managed mutual funds, but still pretty pricey. The minimum to invest is $50,000.

Rydex offers a fund of hedge funds, an index that follows the S&P’s Hedge Fund Index the same way other index funds follow the S&P 500. Take a look at their tables; the difference in performance between the “with load” and “without load” is big.

The CNN article goes on to list some others.

Updated February 6, 2012 and originally published May 27, 2005. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Luke Landes, also known as Flexo, is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about him and follow Luke Landes on Twitter. View all articles by .

{ 2 comments }

avatar nickel

2.2% in fees seems pretty steep.

fivecentnickel.com

avatar Luke Landes ♦127,371 (Platinum)

It’s out of my price range, but I tend to go for the funds with less than 0.50%. For a hedge fund, 2.2% is low if it is the full story. The typical hedge fund charges 1-2% of assets plus around 20% of profits.

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