Hedge Fund News From HedgeCo.Net

Hedge fund correlation risk alarms investors

FT – Hedge funds’ correlation with the equity market has risen back to pre-financial crisis highs, raising fears that the $2.7tn industry could again suffer sharp losses in the event of a market slide.

The level of correlation may also raise questions about the high fees of hedge funds, given that investors can get equity market exposure, or “beta”, very cheaply via passive tracker funds.

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