Profits In Hedge Fund Investing

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The typical hedge fund investment contains derivatives are usually high yield and debt from companies considered risks, so they've to pay more to borrow, or their loans sell at discounted rates which means the yield on the return is higher. Your current products use a $1,000 loan as an example, an issue company loan rate at 8%, that is a decent comfortable visit. Now, if that same company gets behind for the loan and the lending institution panics, may possibly sell it at a 50 percent reduction for the setting up a private limited company in Singapore balance on the hedge money. This in effect helps to ensure that not only does the fund get 16 percent interest, but if the company actually pays the loan in full, they make a 100 percent gain on that earnings.

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