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How To Invest

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Investing in Cattle through Futures Contracts

Two futures contracts exist for the cattle trader and investor: the live cattle and the feeder cattle contracts, both of which trade on the Chicago Mercantile Exchange [more…]

Investing in Lean Hogs and Pork Bellies via Futures Markets

You can invest in hogs in two ways: through a lean hog futures contract (which is a contract for the hog’s carcass), and through pork bellies (the traders’ way of saying “bacon”). [more…]

What Is Currency Trading?

Currency trading is speculation, pure and simple. The securities you’re speculating with are the currencies of various countries. For that reason, currency trading is both about the dynamics of market [more…]

What Is the Interbank Market?

When people talk about the “currency market,” they’re referring to the interbank market. The interbank market is where the really big money changes hands. Minimum trade sizes are one million of the base [more…]

Trading in the Interbank Market

The interbank market is an over-the-counter (OTC) market, which means that each trade is an agreement between the two counterparties to the trade. There are no exchanges or guarantors for the trades, just [more…]

What Are Currency Pairs?

Forex markets refer to trading currencies by pairs, with names that combine the two different currencies being traded against each other, or exchanged for one another. Additionally, forex markets have [more…]

How to Identify Base and Counter Currencies

When you look at currency pairs, you may notice that the currencies are combined in a seemingly strange order. For instance, if sterling-yen (GBP/JPY) is a yen cross, why isn’t it referred to as “yen-sterling” [more…]

What Affects Currency Rates?

The forex market sets the value of one currency relative to another, so data's being digested about at least two major international economies at the same time. Add in half a dozen or more other national [more…]

What Are the Trading Hours of the Forex?

The forex market is open and active 24 hours a day from the start of business hours on Monday morning in the Asia-Pacific time zone straight through to the Friday close of business hours in New York. At [more…]

Key Daily Times and Events in Foreign Currency Trading

In addition to the ebb and flow of liquidity and market interest during the global currency trading day, the following daily events tend to occur around the same times each day. [more…]

What Is a Hedge Fund?

In the investment world, “I run a hedge fund” has the same meaning as “I’m a consultant” in the rest of the business world. In general, a hedge fund is a private partnership that operates with little to [more…]

What Are Characteristics of Hedge Funds?

A hedge fund differs from so-called “real money” — traditional investment accounts like mutual funds, pensions, and endowments — because it has more freedom to pursue different investment strategies. [more…]

Who Manages Your Hedge Fund?

Many different people work for, with, and around hedge funds. The person who organizes the hedge fund and oversees its investment process is the fund manager [more…]

Hedge Fund Fees to Expect with Your Investment

Hedge funds are expensive, for a variety of reasons. If a fund manager figures out a way to get an increased return for a given level of risk, he deserves to be paid for the value he creates. [more…]

Know What Communication to Expect from Your Hedge Fund Manager

The partnership agreement you sign with your hedge fund manager probably will cover what kind of communication the hedge fund manager wants to arrange and how often he’ll make contact. [more…]

Types of Hedge Fund Partnerships: General and Limited

Most hedge funds are structured as lightly (if at all) regulated investment partnerships, but that doesn’t mean that the partners within a fund are equal. Some partners stand on higher ground than others [more…]

Types of Hedge Funds: Absolute-Return and Directional

You can sort hedge funds into two basic categories: absolute-return funds and directional funds. The hedge fund that you choose depends on your investment strategy. [more…]

Do You Meet Hedge Fund Investing Qualifications?

Hedge funds aren’t for everyone. If you don’t meet the SEC’s definition of an accredited investor, you can’t invest in a hedge fund. And some hedge funds go beyond the SEC requirements, making sure that [more…]

Traditional Asset Classes in Hedge Funds

Although many hedge funds pursue strategies and assets known only to a well-informed few, most funds have some investment positions in ordinary investment classes. You may be surprised that these funds [more…]

Alternative Assets in Hedge Funds

An alternative investment is anything other than stocks, bonds, or cash. Hedge fund managers, sniffing out opportunities to meet their investment objectives, often turn to alternative assets. [more…]

Buying Assets for Strategic Gains through Hedge Funds

When a hedge fund manager or other investor buys a security, he or she is said to be long. An investor has only one reason to go long: He or she thinks that the asset will go up in price. [more…]

Selling Depreciating Assets in a Hedge Fund

Hedge funds can make money by selling securities, and not necessarily securities that they own. A short-seller borrows a security from someone else (usually from a brokerage firm’s inventory) and then [more…]

Determine Financial Goals before Investing in Hedge Funds

Before you invest in a hedge fund, you need to answer two key questions: When do you need your money and what do you need your money for?

Your answers influence the risk you can take, the return you need [more…]

How to Calculate Net Asset Value of a Hedge Fund

Hedge funds are priced on their net asset value. Also called book value, net asset value is the total of all the fund’s assets minus all the fund’s liabilities. [more…]

Questions to Ask Your Hedge Fund Manager

Because hedge funds are structured as partnerships, you enter into a relatively intimate business relationship with the fund manager when you buy into the fund. Consider asking these questions as you build [more…]


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