A big financial organization that only accepts money from big time investors with promises of large returns. Smaller investors need not apply. Stories abound of hedge funds requiring a minimum investment of one million dollars.
Hedge funds became famous after George Soros made billions betting the British pound would fall. Recently, the LTCM fiasco also brought hedge funds into the media mainstream, as Alan Greenspan organized a big bailout of a hedge fund by several large banks and financial organizations.