Recent research by Barron’s (see Hedge funds head south) suggests hedge funds this year look like they are not going to deliver anything like expected returns. Separately, backed by a wide ranging report from the well regarded Nomura research department , the stockbroker’s managing director Michael Harris said earlier this month: “There is no evidence that alterative assets as a group, outperform passive benchmarks (i.e. the ASX 200) when it comes to diversification or returns."
So should investors steer clear of such alternative assets altogether? The answer to this is no, but only if you can overcome the following obstacles: