Assighment Essay Example | Topics and Well Written Essays - 1250 words

Assighment - Essay Example It is through this book that various aspects of the hedge fund scheme are being addressed, and how investors should go about resolving the imbalance created by hedge fund managers. It is true that there is a lot of money to be made from hedge funds, because the success of most hedge funds proves that opportunities are present (Lack 42). In an aggressive, fast-changing business environment, individuals are always coming up with ways in which they can benefit from each other. However, the vulnerability of some individuals, especially with regards to finances, is being capitalized on by individuals who are willing to make quick cash from susceptible folks. It is in light of this that the author sought to address some of the aspects that surround hedge funds. The author describes how to tackle the menace that arises from investment managers, and how to become stronger when opportunities are likely to occur once an individual chooses to invest (Lack 46). Summary of the book According to S imon Lack, investors need to be cautious of the risk hedge funds pose on their unsuspecting nature. It is true that hedge funds can be a lucrative source of capital, but the manner in which people are losing their money is not worth ignoring. First and foremost, the charges required to invest in a hedge fund, according to the author, tend to always be ridiculous. It is the author’s belief that half the money invested by investors could make more returns had they put invested in treasury bills (Lack 51). All these assumptions point or lead to one conclusion that; hedge funds are in business for their own interest, and not those of their investors. This bold statement makes one wonder of all that is currently happening to the invested money that happens to find its way into hedge funds. This is also described in the book when the author insinuates that investors lose almost 25% of their invested money to the hedge fund industry. The superior rate of returns, often hyped by hedg e funds, is usually a ploy to have people invest in something that may not necessarily wield high returns (Lack 53). The author believes that even the traditional methods of investment have better luck in having better/higher returns as compared to the glorified schemes of hedge funds. The numbers, as the book suggests, do not add up or are not consistent with what is actually happening in these organizations. It is this claim that leads to the casting of doubt on the whole hedge fund charade. The controversial manner in which the author divulges information about the hedge fund industry brings to light some of the common mistakes people make, and why it is vital to be open-minded when it comes to deals that are too good to be true. Strengths and weaknesses of the book The manner in which the author divulges this information is done in a simple, much easy to understand language. Simple examples have been used to describe scenarios in which individuals are often in, and how they are susceptible to manipulation once the promises of exceptional returns are introduced. No financial or mathematical complexities have been used, so it is easy for even the not so avid reader to comprehend. Moreover, the anecdotes that the author knits into the book form a basis for a relaxed atmosphere where the