This post contains sponsored advertising content. This content is for informational purposes only and is not intended to be investing advice.
Reportedly, the majority of hedge funds invest primarily in a mix of traditional equities and bonds. This kind of portfolio often garners respectable returns, but there is theoretically more opportunities for alpha in other sectors as well.
This is arguably laid bare by the recent downturn in the market, especially tech stocks. Funds that try to maximize growth often concentrate on specific markets. For example, after a meteoric rise to fame, ARK Investment Management LLC has performed relatively poorly in recent days. CEO Cathie Wood bet heavily on companies like Tesla Inc. (NASDAQ: TSLA), Zoom Video Communications Inc. (NASDAQ: ZM) and Roku Inc. (NASDAQ: ROKU), down roughly 25%, 45% and 55%, respectively, this year.
The world of alternative investment has been growing as a way to diversify out of these traditional avenues. Diversifying in this way can not only provide a hedge against the whims of the stock market but can offer returns that are not tied to a single sector or instrument.
What is an alternative investment? In reality, it is an incredibly broad term; its precise definition changes depending on whom you ask. For the fund Hedonova, it means cryptocurrencies, fine art, litigation financing, student financing, promising startups, real estate and traditional equities.
To really stand out in the alternative investment space, it takes creativity. Hedonova has increased returns in its European vacation rental property investments with Airbnb (NasdaqGS: ABNB) by partnering with alcohol distributors and charging a premium price for alcohol delivered straight to the rooms. This has increased returns from 28% to 37%.
Hedonova says its portfolio is largely independent of the stock market and built for sustained, long-term growth. So far, since its inception in 2020, the firm has reported returns of about 55% yearly.
The fund states that this growth has come from smart and disciplined decision-making and a basic credo that puts action at the center of everything. Hedonova claims to be a team, not a family, the distinction being that teams accomplish rather than nurture. The firm “worships at the altar of action,” holding the ancient Chinese proverb that “talk doesn’t cook rice” as a core tenant of its identity.
This ethos reportedly carries over into everything the fund does, and in this spirit Hedonova says it charges significantly lower fees than the average fund, putting its money where its mouth is, so to speak. The national average is 1.4% management fee and 16.4% of profits, Hedonova charges 1% and 10%.
If you are interested in learning more about Hedonova, click here.
This post contains sponsored advertising content. This content is for informational purposes only and is not intended to be investing advice.
Photo by Josh Appel on Unsplash
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.