Hi all,
I'm no expert at all, but it seems as though one important reason why hedge funds have underperformed in comparison to private equity funds is because the latter have capital lock up periods during which an investor cannot withdraw their investment without facing a penalty charge. By contrast, it seems is the hedge funds do not have such a clause and rather, investors can withdraw from hedge funds as they wish.
I realise that private equity funds have this requirement since their investments are far more liquid than those of hedge funds, but why don't hedge funds also lock up investor capital? This could allow them to invest in longer term opportunities and ultimately boost their returns.
Modi id illum corrupti vel. Deleniti et iste maiores reprehenderit debitis neque voluptates. Ipsum praesentium quia quisquam harum expedita amet aut.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...