Assets managed by hedge funds have skyrocketed into the trillions. Eager investors and savvy financial wizards come together to invest money in a variety of unique ways. There are basic steps to get started in the hedge fund market. Here are the steps to start a hedge fund.
Attend a conference. The best way to get information on starting hedge funds is to get it from the horse’s mouth. Conferences are held annually where hedge fund managers showcase their talents and give tips on the best way to start. Find the major conference on the Hedge Fund Conferences website.
Get a lawyer for a variety of reasons. Investor contracts, performance and management fees are all items that need to be handled legally by a good attorney with a solid background in financial investment.
Hire a communications director. The ability to effectively communicate with shareholders and potential shareholders will be one of the most pivotal roles in the creation of a hedge fund. This person needs to know how to write effectively in a business manner and speak one on one to investors with millions to invest into the hedge fund.
Find a compliance officer with experience in Sarbanes-Oxley and funds management. This is not a requirement since hedge funds currently don’t experience a high degree government regulation. It is a good faith measure and a selling tool to potential investors. It says that there is a right way to make a lot of money.
Network like a wild person. Knowing the right people in the right places will be the crucial piece of creating a hedge fund. Find the places where investors are and get as much exposure as possible.
Gather confirmed investors with assets totaling at least $20 million. Hedge funds need a solid starting point. Twenty million in assets will go a long way.