investors are being tempted out of fixed interest hedge funds by the prospects for equities
GAM predicts tough times ahead for fixed income hedge funds as investors shun the asset class following poor performance. David Smith, chief investment officer at GAM, said the recent sell-off and volatility could pose a serious longer-term risk to the industry. Some investors who viewed fixed income as a lower-return, lower-risk asset class could lose confidence in hedge funds, he said, especially if their managers had been caught out by recent events. 'Many mortgage backed securities have dropped 5% to 10%, which wipes out gains for the past six months or perhaps the past year,' Sm...
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