Goldman to Hedge Funds: Take More Risk

A report from the Wall Street firm argues that too many funds are loaded up with stocks that don’t generate alpha. What’s needed? More idiosyncratic risk.


Hedge funds so far are lagging the market this year. If that situation persists, this will be the seventh consecutive year the supposed smart-money set fails to beat the widely followed indexes.

Goldman Sachs seems to think it knows what is causing the underperformance: Hedge funds are not taking enough risk.

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