{"id":5744,"date":"2019-03-16T09:00:37","date_gmt":"2019-03-16T03:30:37","guid":{"rendered":"http:\/\/capitalante.com\/?p=5744"},"modified":"2020-03-09T12:01:53","modified_gmt":"2020-03-09T06:31:53","slug":"hedge-funds-in-india","status":"publish","type":"post","link":"https:\/\/capitalante.com\/hedge-funds-in-india\/","title":{"rendered":"Hedge Funds in India"},"content":{"rendered":"

Looking for\u00a0the Best fund other than a mutual fund to invest in India<\/strong> for long-term Investment that may give better returns in comparison to mutual funds with minimum risk? If you are a High Net Worth Individual\/investor who wants to invest above 1 Crore at once then hedge funds is one of the investment opportunities which are capable of delivering better returns in the long term.<\/span><\/p>\n

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What is Hedge Fund?<\/strong><\/span><\/h6>\n

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Literally, hedge means to prepare a strategy and act accordingly to protect a portfolio free of loss and deliver the best possible returns. Usually, Hedge fund collects money from high net worth individuals (HNI), banks, insurance companies, corporate companies, pension funds etc. The money collected from the above-mentioned sources is used by fund manager of hedge fund to invest in various asset classes namely equity, rare stamps, real state, antiques, commodities, precious metals, coins, cryptocurrencies [such as Bitcoin, Ethereum], private shares in start-ups etc. to generate better returns for the investors. In order to enable greater returns, the fund managers make use of scalp trading i.e. buying and selling shares which takes place in minutes to seconds.<\/span><\/p>\n

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Different strategies a Hedge Fund manager makes use of while investing.<\/strong><\/figure>\n<\/div>\n

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To deliver better returns fund managers make use of several investment strategies namely-<\/span><\/p>\n

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Short Selling<\/strong><\/span><\/h6>\n

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Generally, a majority of investors takes a long position on any stocks after making a proper fundamental and technical analysis of stocks. Unlike retail investors fund managers of hedge funds take a long position in stocks which are undervalued and in contrary take a short position in such stocks which are overvalued. In other words, when stocks witness a sharp correction then the fund manager buys those stocks in an attractive valuation.<\/span><\/p>\n

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Make use of different trading strategy<\/strong><\/span><\/h6>\n

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The fund managers of hedge funds make use of technical analysis to find out and exploit intraday price fluctuations by making use of charts, daily moving average, stop loss, resistance, support etc.<\/span><\/p>\n

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Make use of an upcoming event<\/strong><\/span><\/h6>\n

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Under this strategy fund manager utilizes an upcoming event such as quarterly or annual results, Merger or acquisitions, restructuring, share buyback, etc.<\/span><\/p>\n

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Searching for stocks which are available at a discounted prices<\/strong><\/span><\/h6>\n

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Various stocks witness a sharp correction owing to weak earning number, increase in debt burden, increase in non-performing assets etc. When the company experiences a financial stress, the company sells its securities at a discounted price of even 50% for financing. Then fund manager makes investment in those stocks after making proper analysis about advantages and disadvantages.<\/span><\/p>\n

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