Equities: A rising tide lifts most


Looking back on 2006, investors must decide whether they are sufficiently religious about hedging to accept the fact that U.S. and global long/short equity funds significantly underperformed the broader market indices.

While the S&P 500 enjoyed 11 positive months last year - a record it hasn't matched in decades - long/short equity funds didn't fare as well. Down months in May and June sent many long-biased managers rushing for cover, thus lowering their net exposures so that they didn't benefit as much when the market rallied.

The Absolute Return U.S. Equity Index rose 0.80% in December, up 11.55% for