Intro: Hedge Funds have traditionally invested in publicly-traded stocks, and have become increasingly interested in private funding rounds being raised by fast-growing technology companies.
Hedge funds have participated in a record-breaking 770 private deals with an aggregate value of $153 billion since the start of the year. By comparison, hedge funds participated in 753 deals with an aggregate value of $96 billion in 2020.
Hedge funds have participated in a record-breaking 770 private deals with an aggregate value of $153 billion since the start of the year. By comparison, hedge funds participated in 753 deals with an aggregate value of $96 billion in 2020.
A lot of different start-ups at really high valuations
Previously, funding start-ups, especially early-stage start-ups, was something that was exclusive to venture capitalists and what you’re now starting to see is these next-gen firms that are happy to take smaller returns on longer time periods, and so they become very competitive. They can basically say, we’re going to fund a lot of different start-ups at really high valuations and push out the VCs.
Startup tech companies with unknown trajectories
If it ain’t broke, don’t fix it, right? So, why are the hedgies moving away from their tried-and-true methods for out-managing the markets? If you look between the lines, overlay the economic outlook of the day and it’s not that hard to see that all the uncertainty in the world has them searching for a new cheat sheet to make money.
So, let me see if I got this right. Hedge fund managers who routinely fail to beat the S&P 500 have decided that investing your money in startup tech companies with unknown trajectories and no earnings is the best way to amp up returns? Does that sound right when you say it out loud?
Wouldn’t it be nice if you could allocate assets to an alternative asset class that isn’t held hostage by the ambiguity of “What comes next?” Would you sleep better if you knew where to park money in an investment with absolute returns and no downside risk? Does the idea of growing your capital base safely at a rate that keeps pace with inflation sound good? If only…
But wait, there is! Senior life settlements are a life insurance asset-backed security that generates above-market yield from the maturity of a legal contract backed by the biggest and best US Legal Reserve life carriers in the game. The “What ifs” and “Would’a, should’a, could’as” are taken out of play. Life settlements just sit quietly and make money in a much different way than betting on Reggie Hedgie to ID the next Google or Amazon. There’s a better cheat code for managing market risk than playing Unicorn Roulette with your money.
