“Hedge funds’ November performance represents their ability as an asset class to both capture market upside and protect against downward market moves,” stated Ben Rossman, Senior Vice President of Greenwich Alternative Investments, which manages one of the world's largest hedge fund databases, as he announce a 1.61% fall in the value of the Greenwich Global Hedge Fund Index last month.

Equity markets plunged last month, and the GGHFI's Long/Short Equity group suffered the worst losses, falling by 2.34%. By contrast, the Short Selling element of this group gained 7.14%, as the S&P 500, MSCI World Equity, and FTSE 100 Indices posted declines of 4.18% 4.24% and 4.30% respectively.

However, the Greenwich Global Hedge Fund Index is up by 10.53% year-to-date, comfortably more than the YTD returns of the major equity benchmarks.

E. Lee Hennessee, Managing Principal of Hennessee Group, which compiles the Hennessee Hedge Fund Index, also noted that November hedge fund performance showed how the more flexible nature of hedge funds has protected investors from the unpredictability of the global markets.

“November was a good example of the value that hedge funds provide to investors, as losses by hedge funds are generally less than those of the overall market in periods of turbulence,” Lee stated, continuing: “The increase in equity volatility has provided good opportunities for long/short equity strategies this year, although arbitrage strategies have not fared as well.”

The Hennessee Hedge Fund Index declined 1.58% in November, but remains up by 11.94% year-to-date.