Wednesday, May 21, 2008

Smaller hedge funds outpace bigfoot firms

Smaller, newer hedge funds continue to outperform the big dogs, according to the latest research from PerTrac Financial Solutions LLC.

The New York-based developer of investment analysis software came to this finding through two studies of the hedge fund industry conducted in March and December of 2007.

In 2007, the average return of hedge funds with less than $100 million in assets was 11.74%, while funds with between $100 million and $500 million averaged 10.27% and funds with more than $500 million averaged 10.22%.

The calculation of annualized returns was even more dramatic.

Smaller funds had an annualized return of 16.01%, while mid-sized funds averaged 12.5% and larger funds averaged 11.5%.

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