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Hedge Funds Drop Most Since May as European Crisis Worsens

Hedge funds declined the most in six months in November as the European debt crisis pushed stock markets lower across the globe.

The Bloomberg aggregate hedge fund index fell 1.5 percent, the most since May, when a sudden selloff in stocks known as the “flash crash” prompted investors to cut risk. Long-short equity funds, whose managers can bet on rising and falling stocks, dropped 1.6 percent last month and gained 6.1 percent since the start of the year.