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At a media conference in Zurich, the Swiss Funds Association SFA presented information on
the latest developments with regard to hedge funds.
... 2008 brought heavy losses for all asset classes worldwide: commodities -62.2%, global indirect real estate investments -58.4%, equities -45.3%, funds of hedge funds -20.8% and corporate bonds -13.4%. Only government bonds posted a positive performance, gaining more than 10%.
"With few exceptions, volatility and correlations were very high in the financial market crisis in
the second half of 2008. The primary focus now is on rebuilding trust in the functioning of the
financial markets, in investment instruments and in the investment styles, as performance
targets were evidently not achieved in the crisis phase and hence liquidity expectations were
also clearly not met," said Hans-Jörg Baumann.
According to Stephen C. Smith, the Madoff fraud has also caused additional uncertainty among investors. In his presentation, he stressed the importance of meticulous due diligence, highlighting that only 12% hedge fund failures can be attributed to business risk only or multiple risks. Clearly more significant are the investment risks and also the operational risks, which are covered by the actual checking of the strategy and implementation of investments.
Assets under management in hedge funds currently total USD 1,029 billion. "We believe that
the hedge funds industry is over the worst of the crisis, and that...................... To view our full article Click here
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