Fund of hedge funds recover from Amaranth collapse

The ratings body believed although the collapse of the US hedge fund, which lost $6.5bn before winding up in September, hurt funds of hedge funds, many offset the losses during the final three months of last year. Randal Goldsmith, fund services analyst at S&P, said: “The value of manager and strategy diversification was well illustrated last year and all the rated funds that had exposure to Amaranth made money during 2006.” However, although the hedge fund industry was not brought to its knees by the Amaranth collapse, S&P recognised a number of managers altered their investment proc...