Hedge funds lose their “crazy” spirit

April 9, 2008

hugh-hendry-picture.jpgThe hedge fund industry has moved away from its roots and lost its “crazy” spirit, says Eclectica Asset Management’s chief investment officer Hugh Hendry.

Whereas hedge funds used to be freewheeling vehicles able to exploit excellent opportunities with small pots of assets, many have now become large institutions or are far too correlated to equity markets, he says.

He believes the returns in the hedge fund industry will fall and could even be negative this year.

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