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Opinion
Nir Kaissar

If Hedge Funds Are Lagging, Why Do They Have So Much Money?

Investors are sticking with them despite a decade of underperformance.

Two guesses: inertia or a gambling mentality.

Two guesses: inertia or a gambling mentality.

Photographer: Brendon Thorne/Bloomberg

By now it’s no secret that equity hedge funds have had a horrible decade. The real surprise is that a record $955 billion was invested in those funds at the end of September 2018.

Which raises the obvious question: Why are so many investors still hanging around?