Putting money into a Standard & Poor's 500-stock index
fund would have gained you more than 12% so far this year, while investing in
the average hedge fund would have generated just 4.8% in returns, net of fees,
through September, according to hedge-fund performance tracker HFR. Even most
strategies correlated with equity markets trail the S&P by a wide mark,
reports Barrons. Put simply, alpha, or the value a manager adds to returns
beyond his benchmark, just isn't there. And that's what the typical hedge fund
promises investors, in return for its hefty fees.
Hedge funds typically lag behind broader indexes slightly
during years with double-digit S&P gains—they do have to hedge, after
all—but it's rarely by this much.
Managers across all strategies are concerned about another
2008-like market crash, but in the meantime, they've been hurt…..
No comments:
Post a Comment