In spite of our faltering economy ^[2] and the recent devaluing of investments on Wall Street, current estimates tally the hedge fund business at over one TRILLION dollars and the industry is expected to continue to expand. As hedge fund managers find increasingly outrageous ways to spend their huge fortunes (many are paid 20 percent of the profits and 2 percent of the assets ^[3] annually), the average investor feels left out and wonders what a hedge fund is and does and how it works. Do you really need an MBA from Harvard to understand how a hedge fund works? No. Can you start one yourself? According to author Wayne P. Weddington, III, the answer is YES!

In Do-It-Yourself Hedge Funds ^[4], Weddington, a senior portfolio manager of one of the world’s top hedge funds, gives instructions on how to use hedge fund strategies to maximize your portfolio and make extra money. If you’re looking for a way to pump up your portfolio, avoid losses, or to just out-perform the majority of investors, Do-It-Yourself Hedge Funds ^[4] is the book for you. Weddington reveals the complicated rules of hedging in understandable, real world examples that can help you gain an investing edge.

Though there are a few occasions where Weddington uses some in depth investing terminology, he generally explains the basics of hedge funds in layman’s terms and defines the words hedge fund investors need to know. He also outlines a step by step plan for investing in your own hedge fund, but more importantly, he shows the ways in which hedge funds can go wrong. If you’ve ever wondered how those guys make their millions (billions?), Do-It-Yourself Hedge Funds ^[4] is a must read.

Chapter one deals with a lot of definitions and teaches what investable instruments are.