Explain the following: Hedge Funds

'Hedge funds', including fund of funds are unregistered private investment partnerships, funds or pools that may invest and trade in many different markets, strategies and instruments (including securities, non-securities and derivatives) and are not subject to the same regulatory requirements as mutual funds, including mutual fund requirements to provide certain periodic and standardized pricing and valuation information to investors. Usually, hedge funds: are organized as private investment partnerships or offshore investment corporations; use a wide variety of trading strategies involving position-taking in a range of markets; employ an assortment of trading techniques and instruments, often including short-selling, derivatives and leverage; pay performance fees to their managers; and have an investor base comprising wealthy individuals and institutions and relatively high minimum investment limit.