Smallest, youngest funds generate best performance, study says


In yet another study on the correlation between age, size and hedge fund performance, New York-based PerTrac Financial Solutions confirmed the premise that emerging hedge funds outperform their older counterparts.

The study, entitled Examination of Fund Age and Size and Its Impact on Hedge Fund Performance, was written by managing director Meredith Jones and featured in the February 2007 issue of the investment journal Derivatives Use, Trading & Regulation.

“The study reveals that smaller and younger funds tend to generate greater monthly returns than do older and larger hedge funds, although smaller funds also appear to be more volatile,”