Financial News Online US- Getting positional data from a hedge fund can be like squeezing blood from a stone. But, despite the secrecy surrounding them, it is generallyaccepted that hedge funds are among the biggest users of derivatives.
Hence the surprise when a large institutional investor suggested hedge funds should be making greater use of derivatives.
This was the case in September this year when David Smith, chief investment director of GAM, the fourth largest fund of hedge funds manager in the world and winner of the Financial News best fund of hedge funds group award 2007, criticized hedge funds for failing to make adequate use of derivatives to achieve their optimal strategic advantage.
Others pointed to the overcrowding in the industry, with many following a “herd-like investment styleâ€Â.
The hedge fund industry has not exhibited the stellar returns that one would expect over the past few years, according to some advisers.
