“Funds of hedge funds: performance, risk and capital formation 2005 to 2010”
A recent academic study of hedge funds of funds' perform-ance during three distinct periods around the crisis found that they were able to produce alpha that was statistically different from zero only during the pre-crisis period.
Calculating alpha using a simple regression analysis vs. various indexes highlights hedge funds of funds' underperformance in 2011.
Hedge Fund Research
Despite providing protection against the massive drawdown in equities in 2007 and 2008, the industry has not seen net inflows since 2007.
Pensions & Investments
According to Pensions & Investments data, terminations by institutional investors totaled $4 billion year-to-date vs. inflows of $1.3 billion.