Hedge funds are just one particular type of managed fund / unit trust. While there is no standard definition of hedge funds, they are characterised by use of complicated strategies involving leverage (borrowing), derivatives and short positions. Given the relative complexity of underlying investment approach, hedge funds are all custom and not suitable for general public (and hence need AI status to invest). As an asset class they were exceptionally hot in the 80s/90s but as time has passed markets have become more efficient and previous strategies no longer provide outperfomance. Warren Buffett famously made a bet in 2008 that certain set of hedge funds well known at the time would not outperform S&P500. It wasn't even close. By 2015, one of the hedge fund guys was leaving industry but the gap was so large, both sides agreed the hedge funds couldn't catch up and didn't bother with an adjustment for the leaving fund. Since then not much has changed, look on Bloomberg and you will see from time to time a hedge fund complain about the rise of algo/quant trading making life really tough for them. The tldr - not for average investor and no big outperformance you are missing out on.