Rich people, investors, bankers and similar beings are very often acting as if what they do is a form of science. Although there is plenty of terms you have never heard of and additionally a lot of maths involved, what these people do is actually pretty simple: they use money to make even more money out of it. In such a game there are certain rules that need to be followed. These rules are neither secret nor extremely bright, if you make an effort, you can find the answer almost wherever you look.
Rule number 1: Never use your own money
Bankers, rich people, investors and similar beings almost never risk their own money in whatever scams they are perpetrating. They always find a people, funds, monies and valuables they can use, sometimes they even borrow money in order to invest, most of the time they borrow money from themselves. If you are confused, let me elaborate. If you have a lot of money and would like to invest it, you do not invest that money directly. You give some of the money to a company you own as a form of investment into your venture. The company speculates that money for you and gains a lot of money; you take your investment back and have now funds in the company to play with. If the company does not make any money and even the whole investment falls through, the company is at a loss, but not you, because the company still owes you the money. You can recover your money from whatever other money that company may have, receive, make, produce, earn or similar.
Rule number 2: Never use your own money
Hedge funds were and still are such a beautiful scam, it will never cease to amaze me that people go for such a setup. Hedge fund managers offer to plenty of separate people who are willing to invest their money to allow them to combine all that money into one large fund, which then can play a significant role in an investment enterprise. With such a financial boost, plenty of possibilities stand at hand, some more risky, some less, but all profitable. The trick is that the hedge fund managers do not use any of their own money. They charge a fee for accepting your money, then they charge a manipulation fee and then they charge you if they make a profit as well. You still come out on top, you get your investment back, plus a healthy profit, but the hedge fund managers earned plenty of money from every participant without risking a dime. Do not forget that if the investment goes bust, only your money is gone, the hedge fund managers have already recouped their fees in advance. Additionally, smart hedge fund managers also charge the company they invest into with a fee as well, making ever more money, in some cases more money than you.