Answered

Which statement best describes a hedge fund?

A. A hedge fund is a pooled investment fund that employs various strategies to earn active returns for its investors.
B. A hedge fund is available to all investors willing to buy in.
C. A hedge fund typically requires a high minimum investment and is available only to accredited investors.
D. A hedge fund is a passive investment vehicle that mirrors stock market indices.



Answer :

GinnyAnswer

Final answer:

A hedge fund is an alternative investment vehicle with high return strategies for accredited investors.


Explanation:

A hedge fund is a type of alternative investment vehicle that employs different strategies to generate high returns for its investors. Unlike traditional mutual funds, hedge funds can engage in activities such as short selling, using leverage, and investing in a wide range of assets like stocks, bonds, commodities, and derivatives. They are typically only available to accredited investors due to their higher risk and complex nature.


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