What are hedge funds and private equity funds? What's the difference? Watchdog wealth answers for you.

Hedge fund refers to financial derivatives such as financial futures and financial options, which are combined with financial instruments to make profits. Private equity funds refer to funds that invest in securities, while hedge funds use financial derivatives, tools and short selling to buy and sell, so as to seize profit opportunities in the sharply rising market or the sharply falling market.

The differences between hedge funds and private equity funds are as follows:

1. Hedge funds are measured by absolute rate of return, because no matter whether the market goes up or down, it is possible to make a profit. The performance of private equity fund is measured by a certain market index, such as S& etc. Take the performance of P500 index or other similar funds as the evaluation.

2. Hedge funds are rarely restricted. When the market falls, they will use derivative financial products for strategy, which will easily improve the performance of the fund. The operation of private equity funds in derivative financial products is greatly restricted, and they cannot profit from it when the market trend is weak.

3. Private equity funds charge a certain percentage of the net fund value, and hedge fund managers charge a certain percentage of the management fee when making profits. It will give fund managers a strong incentive to help customers earn income, and the probability of relative risk will increase a lot.

4. Hedge funds can operate different combinations of derivative financial products to determine how high the market exposure risk is. Private equity funds cannot use derivative financial products to avoid the risk of market decline. At most, the investment portfolio of the protection fund only increases the cash ratio or engages in limited index futures operations.

Hedge fund is the international name of private equity fund, which is customarily called private equity fund in China, aiming at pursuing absolute rate of return. There are quite a few financial instruments in the international financial market that can be used as a means of risk hedging, which is also the origin of the name of international hedge fund. Reference website: Asimu. /knowledge/index.

What are hedge funds and private equity funds? Hedge funds. An investment fund. Belonging to the inspection-free market products. Hedge funds are called funds, which are essentially different from mutual funds in terms of security, income and appreciation. The Fund uses various trading methods (such as short selling, leverage, program trading, swap trading, arbitrage trading, derivative products, etc.). ) to hedge, transpose, hedge, and make huge profits. These concepts have gone beyond the traditional operation scope of preventing risks and ensuring benefits. In addition, the legal threshold for launching and establishing hedge funds is much lower than that of mutual funds, which further increases their risks. In order to protect investors, the securities management agencies in North America classify it as a high-risk investment category, and strictly restrict the participation of ordinary investors. For example, it is stipulated that each hedge fund should have less than 100 investors and the minimum investment is $6,543,800+0 million.

Compared with public offering, private offering is defined as public offering and private offering, or public offering and private offering according to the different ways of securities issuance and whether securities are issued to an unspecified public. When it comes to private equity funds, many people may feel strange, but when it comes to "quantum funds" and "tiger funds" in the international financial market, everyone may be familiar. These hedge funds, which wander like ghosts in the international financial market and make waves frequently, are the most typical private equity funds abroad. These financial "predators" repeatedly shot in the Southeast Asian financial crisis, which made us clearly feel their amazing ability. As the name implies, private equity funds correspond to "public offering". Public Offering of Fund is a common open-end or closed-end fund in our life. In the face of public offering, the domestic starting point is generally 1 ,000 yuan or 1 ,000 yuan. Private placement belongs to "rich people" funds, and the starting point for entry is relatively high. The starting point in China is generally 500,000, 1 10,000 or even higher, and the number of fund holders is generally no more than 200. Large private placements are often raised through trust companies, and it is difficult for ordinary investors to join. Private equity institutions that always hide behind the scenes are undoubtedly the most dazzling stars in the investment and wealth management market, and their investment performance is generally higher than that of funds. In contrast, it is simply not worth mentioning that funds and brokers collect wealth management.

The website of "China Home of Big Investors" has information about "Private Trust" and "Collective Financing of Brokers".

What is a hedge fund? Is there a difference between private equity funds and hedge funds?

Hedge funds are often called "long/short stock hedging", pointing out that hedge funds emphasize short selling and short selling investment strategies, and each hedge fund will adopt a unique strategy suitable for its own situation. Its investment targets include stocks, bonds and commodities, especially high-yield derivative financial products and differentiated debts.

Because general mutual funds stipulate that short selling is not allowed, the purpose of hedge funds is to hedge the downside risks in the market. However, today, the operation mode of hedge funds is quite different from its original intention. On the contrary, it is aimed at maximizing income, and most of them use short selling to trade with derivative financial products to increase rather than reduce risks.

Hedge funds are mostly open-end funds and private equity funds are mostly closed-end funds, but hedge funds often raise funds by private placement.

Compared with private equity funds, hedge funds are less liquid and often require investors not to redeem them at will within a certain period of time. Hedge funds can reach billions of dollars, and leveraged funds have higher total assets. The scale of private equity funds varies greatly and there is no leverage.

What do hedge funds and private equity funds mean respectively? Hedge funds are also called arbitrage funds or hedge funds. Hedge originally refers to the speculative method of using two bets to prevent losses in gambling. Therefore, speculative funds traded in the financial market are called hedge funds. American hedge funds have developed with the development of American financial industry, especially the emergence of futures and options trading. At present, there are at least 4,200 hedge funds in the United States with a total capital of over $300 billion. 1. The characteristics of hedge funds The biggest feature of hedge funds is loan speculation, that is, short selling. About 85% hedge funds in the United States speculate on loans. After selecting a suitable market or project, with a small amount of funds as the bottom, make huge loans to commercial banks, investment banks or stock exchanges, and then pour a lot of money into annihilation, or lose or win. Their investment strategy is absolutely confidential. Since 1990s, the risk coefficient of American hedge funds has been increasing, but most of them are successful. 2. Hedge funds are classified by trading means, which can be mainly divided into low-risk hedge funds, high-risk hedge funds and crazy hedge funds. ① Low-risk hedge funds. It mainly invests in American and foreign stock markets, and generally rarely uses more than twice its own funds for speculative trading. Trading methods are mainly long-term buying and short-term selling, that is to say, buying stocks that may rise, borrowing and selling stocks that may fall; Buy back these stocks after the market improves; ② High-risk hedge funds. Speculative transactions are often carried out with loans 25 times higher than capital, including long-term buying and short-term selling in global stock markets, as well as large-scale speculative transactions in global markets such as bonds, currencies and commodity futures. A typical example is the quantum fund operated by Soros; ③ Crazy hedge funds. Speculate in the international financial market with loans ten times or even dozens times higher than its own capital. The most typical example of this kind of hedge fund is the American long-term capital management fund, which used to borrow more than $65.438+0 billion from banks with assets of more than $4 billion, and the market value of various securities and stocks it bought and sold was as high as $ 654.38+0.25 trillion, which led to the outbreak of the American hedge fund incident in September, 1998. 3. The difference between hedge funds and mutual funds In a broad sense, hedge funds are also a kind of mutual funds, but compared with general mutual funds, hedge funds have many unique characteristics: ① investor qualifications. Investors in hedge funds have strict qualifications. The securities law of the United States stipulates participation in the name of an individual, with an income of at least $200,000 in the last two years. If you participate by surname, your husband and wife have earned at least $300,000 in the last two years; In the name of the organization, the net assets are at least $6,543,800+0,000. 1996 made a new regulation: the number of participants was expanded from 100 to 500. The condition of participants is that individuals must own investment securities worth more than $5 million. General mutual funds do not have this restriction. ② Operation. The operation of hedge funds is unrestricted, and there are few restrictions on investment portfolios and transactions. Major partners and managers can freely and flexibly use various investment technologies, including short selling. Trading and leverage of derivatives. Ordinary mutual funds are more restricted in operation. 3 supervision. Hedge funds are currently unregulated. The Securities Law of the United States 1933, the Securities Exchange Law of 1934 and the Investment Company Law of 1940 all stipulate that institutions with less than 100 investors need not register with the financial authorities such as the Securities and Exchange Commission of the United States when they are established, and can be exempted from regulation. Because investors are mainly a few very sophisticated and wealthy individuals, they have strong self-protection ability. In contrast, the supervision of mutual funds is relatively strict, mainly because investors are the general public and many people lack the necessary understanding of the market. In order to avoid public risks, protect the weak and ensure social security, strict supervision is implemented. 4 financing methods. Hedge funds are generally initiated through private placement, and the securities law stipulates that no media should be used to advertise when attracting customers. Investors mainly participate in four ways: according to the so-called "reliable investment news" obtained by the upper level; Know hedge fund managers directly; Transfer through other funds; Investment bank. Specially introduce securities intermediary companies or investment consulting companies. Most common mutual funds entertain customers through public offering and advertising. ⑤ Whether it can be established offshore. Hedge funds usually set up offshore funds, which has the advantage of avoiding the restrictions on the number of investors and tax avoidance in American law. Usually located in the Virgin Islands, Bahamas, Bermuda, Cayman Islands, Dublin, Luxembourg and other tax havens, these places have little tax revenue. Of the $68 billion hedge funds, $70 million is invested in offshore hedge funds. According to statistics, if "funds of funds" are not included, the assets managed by offshore funds are almost twice that of onshore funds. Ordinary mutual funds cannot be established overseas. Private placement is relative to public offering. At present, all funds in China are raised through public offering, which is called fund public offering. If a fund does not go through public offering, but privately raises funds for a specific target, it is called a private equity fund. There are two ways to raise funds, one is through equity, each fund holder is a shareholder of the fund, and the manager is also one of the shareholders. The other is contractual, and the relationship between the holder and the manager is contractual, not equity. At present, public offering funds are all contractual, but at present, China's laws only allow public offering funds to raise funds by contract. Therefore, if you want to set up a private equity fund, you must adopt the way of equity, so there is no legal obstacle.

What is a hedge fund? What is the specific relationship between hedge funds and private equity funds? The English name of Hedge Fund is Hedge Fund, which means "risky hedge fund". Originated in the United States in the early 1950s. The purpose of its operation is to use financial derivatives such as futures and options, as well as the operating skills of buying and selling different related stocks and hedging risks, which can avoid and resolve the risks of securities investment to a certain extent. In the most basic hedging operation. After the fund manager bought a stock, he also bought a put option with a certain price and time limit. The utility of put option is that when the stock price falls below the option-limited price, the holder of seller option can sell his stock at the option-limited price, thus hedging the risk of stock decline. In another hedging operation, the fund manager first chooses a certain kind of bullish industry, buys a few good stocks in this industry and sells a few bad stocks in this industry according to a certain proportion. The result of this combination is that if the industry is expected to perform well, the increase of high-quality stocks will exceed other stocks in the same industry, and the income from buying high-quality stocks will be greater than the loss caused by shorting inferior stocks; If the expectation is wrong, the stocks of this industry will fall instead of rising, then the stocks of poor companies will fall more than the high-quality stocks. Then the profit of short selling will be higher than the loss caused by the decline in buying high-quality stocks. Because of this mode of operation, the early hedge fund can be said to be a form of fund management based on the conservative investment strategy of hedging. 1. Private placement fund, called private placement abroad, is a financial concept corresponding to Public Offering of Fund. It is a collective investment that publicly raises funds from specific investors in private, and is often called "underground fund" in China's financial market. There are two kinds of private equity funds commonly used in the financial market, one is contractual private equity funds based on signing entrusted investment contracts, and the other is corporate private equity funds based on joint-stock companies. At present, the more popular private equity funds in China are generally contractual private equity funds. From the legal nature, contractual private equity fund is essentially a trust legal relationship, and its parties include promoters (fund managers), investors (fund share purchasers) and beneficiaries (generally investors or fund share holders). Investors entrust trust funds to fund managers through contracts (trust contracts); Fund managers use fund funds for securities investment or industrial investment in their own names. Investment gains are shared by share holders, and investment losses are also shared by fund share holders. At the same time, the fund manager receives remuneration as agreed. Before the introduction of relevant laws and regulations to adjust private equity funds in China, we can supervise such private equity funds with reference to the relevant provisions of the Trust Law. Due to the lack of systematic legal norms, there are often huge potential risks in the operation of contractual private equity funds in China, and even become tools for some lawless elements to seek illegal interests. In practice, there are two kinds of illegal private equity funds: illegal fund-raising and illegal or disguised absorption of public deposits. According to the provisions of China's criminal law, illegal fund-raising refers to the behavior of legal persons, other organizations or individuals to raise funds from the public without the approval of the competent authorities. The object of illegal fund-raising is the public, and most of the means are fraud, deceiving the public and inducing their investment by promising high returns and high interest rates. Fraud is the most important reason prohibited by law. Generally speaking, the target of private equity funds is a few specific investors, and the threshold of these investors is generally high. The amount of funds involved should be of a certain scale, such as 6.5438+0 million yuan. Its purpose is to invest together, share benefits and, of course, risks. However, if the promoters of private equity funds promise investors a high proportion of guaranteed income, they can be identified as illegal fund-raising. According to the laws of our country, no unit or individual may engage in the business of absorbing public deposits or absorbing public deposits in disguised form without the approval of the competent financial department, otherwise it will constitute an illegal act. The fundamental difference between illegal or disguised absorption of public deposits and private equity funds lies in whether to pay interest. The income of private equity funds comes from risk income and should not involve any form of fixed interest, otherwise it will be illegal. To sum up, if the establishment of private equity funds conforms to the provisions of China's trust law, its legitimacy should be beyond doubt, but in its specific operation process, it must not violate the relevant provisions of existing laws. 2. The English name of Hedge Fund is Hedge Fund, which means "hedge fund" and originated in the United States in the early 1950s. The purpose of its operation is to use financial derivatives such as futures and options, as well as the operational skills of buying and selling different related stocks and hedging risks, which can avoid and resolve investment risks to a certain extent. In the most basic hedging operation, the fund manager buys a put option with a certain price and term after buying a stock. The utility of put option is that when the stock price falls below the option-limited price, the holder of seller option can sell his stock at the option-limited price, thus hedging the risk of stock decline. In another hedging operation, the fund manager first chooses a bullish industry, buys several high-quality stocks in this industry, and sells several inferior stocks in this industry according to a certain proportion. The result of this combination is that if the industry is expected to perform well, the increase of high-quality stocks will exceed other stocks in the same industry, and the gain from buying high-quality stocks will be greater than the loss from shorting inferior stocks; If the expectation is wrong, the stocks of this industry will fall instead of rising, then the decline of the stocks of poor companies will be greater than that of high-quality stocks, and the profit of short selling will be higher than the loss caused by the decline of buying high-quality stocks. Because of this mode of operation, the early hedge fund can be said to be a form of fund management based on the conservative investment strategy of hedging. After decades of evolution, hedge funds have lost the original connotation of risk hedging, and hedge funds have become synonymous with a new investment model. That is, based on the latest investment theory and complex financial market operation skills, we should make full use of the leverage of various financial derivatives to undertake high-risk and high-yield investment models.

What is a private hedge fund? Hedge fund, also known as hedge fund or arbitrage fund, refers to a financial fund that combines financial derivatives such as financial futures and financial options with financial institutions and obtains profits by means of high-risk speculation. It is a form of investment fund, which belongs to exempt market products. It means "risk hedge fund", and hedge funds are called funds. The investment concept of mutual fund's safety, income and appreciation is actually seen on CIC Online official website.

What are hedge funds and private equity investment hedge funds refer to funds that invest in the stocks of listed companies, pursuing extra income beyond the market, referred to as alpha income.

Private equity investment funds generally refer to funds engaged in equity investment of non-listed companies, pursuing dividends from shareholders before listing and realizing equity after listing. The fund is called "PE".

What's the difference between private equity funds and hedge funds? Do these two funds exist in China now? Private equity investment (also known as private equity investment or private equity fund) is a very broad concept, which refers to the investment in any kind of equity assets that cannot be traded freely in the stock market. Passive institutional investors may invest in private equity investment funds, which are then managed by private equity investment companies and invest in target companies. Private equity investment can be divided into the following categories: leveraged buyout, venture capital, growth capital, angel investment, mezzanine financing and other forms. Private equity investment funds generally control the management of the companies they invest in and often introduce new management teams to enhance the company's value.

Funds that use hedging transactions are called hedge funds, also known as hedge funds or hedge funds.

It refers to a financial fund that aims at profit after financial derivatives such as financial futures and financial options are combined with financial instruments.

It is a form of investment fund, which means "risk hedge fund".

What are hedge funds and quantum funds? It is a form of investment fund, which belongs to exempt market products. It means "risk hedge fund". Hedge funds are called funds, which are essentially different from mutual funds in terms of security, income and appreciation. Quantum Fund is a world-famous large-scale hedge fund and one of the five largest hedge funds run by American financier george soros. Quantum fund is a high-risk fund, which mainly borrows money to invest in global stocks, bonds, foreign exchange and commodities. Quantum Fund is not registered with the US Securities and Exchange Commission, but offshore in Cura? ao. Mainly take the way of private placement to raise funds. Soros named it "quantum" because Heisenberg, a German physicist and founder of quantum mechanics, whom Soros admired, put forward the "uncertainty theorem". Soros believes that just as the physical quantum of particles cannot have a definite value, the securities market is often in an uncertain state, so it is difficult to measure and estimate accurately.