Apart from the fact that many funds have folded because of disastrous financial returns, the glamour of the industry has only somewhat faded. Hedge funds are still attracting big investors.
Invested funds are now easier to remove. Investors have more leeway with management and can be more particular with regard to investment withdrawal terms.
However, hedge fund charges are not much lower. Management fees generally are still set at 1½% of managed assets and 20% of the profits generated. Sought-after funds charge even more, as before.
Hedge funds operate in different ways with varying objectives. They have a tougher row to hoe in this economy and principals may face higher taxes.
But they remain a factor because only they in the investment industry, have the speculative funds and freedom to operate these days, when political eyes are more focused on commercial and investment banks. ( See the Earl J Weinreb NewsHole® comments.)
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