Assets in Market Neutral Mutual Funds up 342% in 3 years
| Feb 16th, 2007 | Filed under: Hedge Fund Industry Trends | By: Alpha Male |
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Market-neutral funds mirror hedge-like strategies
By: Murray Coleman, MarketWatch
Published: February 12, 2007
Hedged mutual funds don’t seem to be going away. In fact, this article suggests anemic equity returns will fuel the rush into these lower-correlation cross-over funds. According to MarketWatch, assets in these funds is up 342% in the past 3 years (to $5 billion). Lipper’s Andrew Clark tells MarketWatch:
“If you’re holding bond funds for diversification, you might want to swap out some of that money for market-neutral or long-short funds. You won’t pick up any more risk. And they’re non-correlated to both bonds and stocks.”
Clark just completed a study of drawdowns in various types of funds from government bond funds to hedge funds. He concludes:
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