Hedge funds braced for worst year since 2008
By Sam Jones in London and Dan McCrum in New York
Hedge funds are set to rack up their second-worst year in two decades after taking a beating from the eurozone crisis and an unexpected slowing in global economic growth.
The average hedge fund manager has lost 4.37 per cent in the year to the end of November, according to data just released by Hedge Fund Research – losing money in six of the past seven months. Only in 2008, following the collapse of Lehman Brothers, did the industry fare worse.
High volatility and correlation have wrong-footed even the most skilled of traders. Managers such as US’s Paulson & Co and Highbridge of the US or the UK’s Lansdowne and Odey have failed to recover double-digit percentage losses for some of their funds suffered in August and September.