Hedge fund performance has proved disappointing to investors expecting the 10%-15% returns of past years. Derek Stewart believes more realistic expectations combined with strategic asset allocation is the key to success
You have access to top managers, absolute returns, diversification, low correlation and capital preservation. So why are investors so disappointed with hedge funds today? They are disappointed because they have been sold the past performance. Everyone is being sold the story of 10%-15% with low volatility ' the reality is that it is not happening. Another problem that arises is time horizons. We have had investors go into our fund and then, after two months, go out. We have made them 1% over two months while stock markets are down 15%, but the returns are still not good enough. Time h...
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