Wednesday, January 9, 2008

Hedge funds demystified

Depending on the global index chosen, hedge funds composite indexes returned 10 to 12 % in 2007 (ex. Barclay hedge fund index: 10.42%; HFRI fund weighted composite index: 10.36%)
As a comparison:
- the total return (price + dividend yield) for the Dow Jones Wilshire Global Total Market Index was 11.9% ;
- the world nominal growth was 8 to 9.5 % that year (depending on the source: World Bank or IMF). If one adds the average dividend yield, this figure comes close to the hedge funds composite indexes returns.

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