Salient to Investors:

  • Tony James at Blackstone said hedge funds are a way to play the stock market with lower volatility and lower returns – shoot-the-lights-out returns are best left to private equity and real estate.
  • Neil Chriss at Hutchin Hill Capital said Calpers’ hedge-fund allocation was not big enough to move the needle but big enough to require real resources.
  • Wilshire Trust Universe Comparison Service said pensions with more than $5 billion in assets had an average of 1.35% in hedge funds as of June, versus 0.85% in 2008. Public retirement plans with $1 billion or more in assets generated a 5.1% annualized return from hedge-fund investments in the 3 years ended June 30 versus 5.3% from fixed-income holdings, 11.5% from private-equity, and 12.7% from stocks.

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