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This article was authored by Bryan Goh, who is responsible for hedge fund research and manager selection at First Avenue Partners LLP, London.

Its going to be harder to make money. Equity long short is correlated to equity markets.

Equity long short managers in aggregate tend to have chronic long biases which introduce positive correlation to equity markets. In aggregate. Particular managers, however, will have particular styles which may offer diversification and downside control. Its all in the skill of selecting the right managers. In aggregate, however, equity markets are likely to be highly uncertain and make it both easier to make and lose money.

Its going to be easier to make money. The markets are dislocated and relative value and arbitrage opportunities exist.

It is going to be easier to make money. Provided there is the skill to identify the arbitrage opportunities, the capital to take advantage of the dislocations, the stability of capital to take a longer term view, or at least a fixed term view, the risk appetite to take on more complexity, the psychological independence to break from a herd stampeding in fear. It will be easier to make money in 2009, but the psychological barriers to investing will be high, perhaps insurmountable.

Leverage will be expensive and hard to get. Markets and investors will continue to deleverage.

True. Financing, as always, is provided to those who need and wa......................

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