Top 3 Questions About Hedge Funds

June 14, 2019 02:00 PM
Hedge Fund Questions

Hedge Fund Questions

#3What essential skills do hedge fund managers need to develop?

Answer:

Your network is your net worth. This goes very far in the hedge fund community. Very far. The community is very small and if you’re talented, everyone will know. If you’re a great stock picker, top firms will wine and dine you. Big bonuses and perks will be available for you all the time. If you have a valuable network outside of the community, your net worth simply increases. Your access to new information is your edge.

Risk management. Too many investors focus on the upside. Few focus on the downside. How can I place the trade in my favor? Where does the reward outweigh the risk? It is tough to find the no-brainer trades.

Managing your risk means managing your losses. If you focus on preserving principal capital the upside will take care of itself.

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