Those looking to explain what's set to be another bad year for hedge funds could do worse than blame their passion for tech stocks.
Bloomberg News reports that the funds have averaged a 4% gain year-to-date, but that pales next to a 9% rally in the S&P 500. Barring a sharp turnaround before December 31, this will be the eighth year since 2008 that hedge funds have underperformed, according to Goldman Sachs strategists including Ben Snider and David Kostin.
"Most hedge funds have improved performance following first quarter struggles but continue to lag the broad S&P 500 index as well as the average mutual fund," the analysts wrote in a monthly monitor of the funds' performance.
Their reasoning? The same thing that helped hedge funders beat the broader index in the third quarter is what's skewered them since the election.
To access the complete Bloomberg News article hit the link below: