Alternative Investments Q10

0. Which of the following is least likely to be a characteristic of a hedge fund?

  • Option : C
  • Explanation :
    • A. Incorrect to say it's "wrong" – Hedge funds are known for being aggressively managed and investing across various asset classes (equities, derivatives, currencies, etc.).

    • B. Incorrect to say it's "wrong" – Hedge funds often do require a lock-up period, during which investors cannot withdraw their money. This is common and true.

    • C. Correct – Hedge funds are not available to the general public. They are typically restricted to accredited or institutional investors due to their complexity, risk, and lack of regulation. While they do require hefty investments, the statement is misleading because the key part that makes it incorrect is saying they are "available to the public."

    • Correct Answer: C. It is an investment opportunity available to the public and requires hefty investment.

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