A hedge fund is a type of investment fund that pools money from private investors and is managed by professional fund managers who use a wide range of strategies to try to generate high returns. Hedge funds are structured as limited partnerships, with the investors as limited partners and the hedge fund company as the general partner. Hedge funds can invest in a variety of assets, including equities, fixed-income securities, and derivatives, and they can use leverage and other techniques to try to maximize returns.

Hedge funds charge higher fees than conventional investment funds, and they are not as strictly regulated by the Securities and Exchange Commission (SEC) as mutual funds are. Hedge funds are generally restricted to large-scale investors, such as high-net-worth individuals and institutional investors, due to their high minimum investment requirements.

The term "hedge" in hedge fund refers to the fund managers ability to hedge the value of the assets it holds, although some hedge funds engage only in "buy and hold" strategies or other strategies that do not involve hedging in the traditional sense. Hedge funds aim for the greatest possible returns and take the greatest risks while trying to achieve them.