Quick Note on Hedge Funds
Someone sent me this update on hedge fund woes. Here it is:
- Hedge funds lost more money in 2008 than any year on record. It may get worse in 2009, forcing fund managers to overhaul investment strategies, reduce fees and make it easier for clients to withdraw cash.
- The $1.2 trillion industry may shed as much as $450 billion in assets, or 37%, through market losses and client withdrawals in 2009, according to a Morgan Stanley analyst.
- That’s on top of the $600 billion that disappeared last year and would leave hedge funds with $750 billion, the lowest since 2002.
- Investment returns fell an average of 18% last year, according to data compiled by Hedge Fund Research, the most since the firm began tracking. While that beat the 38.5% loss by the S&P 500 Index, many investors were angered when fund managers limited or froze withdrawals.