What Exactly Are Hedge Funds (And Why Are They Always Causing Problems)?

CORRECTION: While some articles referred to Archegos as a hedge fund, it is actually a family office. Sorry for the mix up.

We've all heard about hedge funds, but what exactly are they, and why can't they seem to stay out of trouble? We dive into the topic in today's video.

DISCLAIMER:
This channel is for education purposes only and is not affiliated with any financial institution, although Richard does work as an employee for an investment manager. Richard Coffin does not provide recommendations on The Plain Bagel - those looking for investment advice should seek out a registered professional. Richard is not responsible for investment actions taken by viewers.

[sikfaka]

Its not the risky behavior that makes us upset, its the fact that they were subsequently bailed out. Without consequences, crazy risk is incentivized, and I blame the people who enable it. In any other sector, this would be seen as criminal negligence or worse. Literally the WORST thing you can do to reduce criminality is to nationalize the consequences

[lukekinder]

Hedge funds: “we hedge against risk.”
Me: “sir, this is a casino.”

[jaycohen]

I gotta say I’m 16 and you really simplify complex subjects down really well especially for teenagers that wanna learn this stuff. u teach me a lot👍

[cohenmarioman]

Hedge Funds also make your taxes potentially way more complicated. Good luck.

[kraaftypants]

Reminds me of the movie The Big Short when Michael Burry basically shorts the housing market. He initially takes huge losses, and you can see the scene where he locks his clients out of withdrawing money. Never realized these were the characteristics of a hedge fund.

[Martin-qbmw]

Hedge funds help the rich get mediocre returns by charging outrageous fees while also consistently underperforming any random index fund. Medallion is an exception obviously but it's closed for non-employees.

[willharris]

3% is an absolutely wild mutual fund expense ratio

[timberwolfe]

The only thing I disagree with is that the companies dont have to disclose their accounts.

So many hedge funds now buy huge companies or such and then dont Have to disclose the amount that they have.

That rule should be added.

[wallstruss]

Thank you for the explanation, very helpful. Keep up the great work.

[clintanderson]

Subscribed, doggonit. This video was the one that pushed me over the edge. I even think finally I understand The Big Short, now, when that guys was saying, "I want my money" and Bale was like, ....and the guy said, "Give me my money. I want my money." And Bale was like...

[TheGGreggs]

Once again an excellent presentation on an economic topic. Thank you.

[dholland]

I know this is a year old, but Subscribed. Us Gen exers need this type of info.

[andrewsteavpack]

You forgot the "Insider Trading" tactic

[fengwang]

Thanks! Excellent and highly educational!

[ronnieeubanks]

Thank you sir for these videos. I am one who isn't very smart on investing and markets but you always manage to have a easy to understand breakdowns.

[siyaful]

Your channel is such a great resource for learning more about finance!

[imranarshad]

Archegos is not a hedgefund, it's a family office.

[shrvn]

Yo man. you are so damn good at this. thank you for the videos. i have enjoyed them and learned plenty!
im glad the YT algo does push your content which is how i found it.

[canadapainter]

Well, simply put, a hedge fund is nothing more than an investment company that invests its clients' money in alternative investments to either beat the market or provide a hedge against unforeseen market changes

[chrisdahl]

Really enjoy this channel. Your explanation of complex matters is really simple. You should do a breakdown of Wall Street buying up single family homes. I'd be curious to learn if its as bad as people say or if there might be some upside that I'm not aware of