Hedge funds returned 7.9% net of fees in 2000, according to the Hennessee Hedge Fund index, well ahead of the S&P 500 index’s 9.4% decline. Superior performance stemmed from low net exposure to stocks and high cash levels.
The top-performing hedge fund style indexes measured by the Hennessee Hedge Fund Advisory Group were its health care index, up 62.4%, short-biased index, 29.9%, and financial equities, 27.8%. Its convertible arbitrage index returned 8.6%, event-driven funds gained 11.1% and market-neutral index rose 7.1%.
