Von Aldo

Hedge Funds Regaining Swagger

Hedge funds, according to Morningstar, are getting their groove back. The Morningstar 1000 Hedge Fund Index climbed 7.4 percent in the third quarter and 17.2 percent through the first ning months of 2009. Of course, hedge funds haven't regained their October 2007 peaks. Morningstar 1000 Hedge Fund Index declined 25.2 percent through February 2009 and has recovered only 20 percent in the last seven months, with 11.4 percent to go, Morningstar says.

I suppose this means that investors' risk-aversion is ebbing, since cash inflows to hedgies turned positive in August. (Except for June, investors had been pulling money out of hedge funds --- $59.7 billion, Morningstar estimates through the third quarter.) The bulk of the net inflows went to the global trend hedge funds inin August.

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