The analysts at Goldman Sachs have just published their latest Hedge Fund Trend Monitor report, which tracks the equity investments of the world’s hedge funds.
One thing is clear: hedge funds are struggling to keep up with the market.
“The typical hedge fund generated a YTD return of 5% through May 10, compared with 15% gains for both the S&P 500 and the average large-cap core mutual fund,” wrote Goldman Sachs Amanda Schneider. “Hedge funds returned an average of 3.5% in 1Q 2013, lagging the S&P 500 by 700 bp. Last year the average fund returned 8% vs. 16% for the S&P 500.”
In other words, you would’ve been much richer if your money were sitting in a boring, low-cost index fund.