Hedge Fund Investing: A Practical Approach to Understanding Investor Motivation, Manager Profits, and Fund Performance

1998 to 2002, When Everyone Took Notice

Eventually, investors did take notice of the extremely high annual returns being generated by a relatively small number of esoteric hedge fund managers. Some returns exceeded 30 percent per year. Industry data began to call attention to the lower volatility of the sector. Market commentators brought media attention to both the high returns being reported and to the stability of the industry's performance before, during, and after the 1998 minicrash, the Y2K crisis, and the NASDAQ meltdown and corporate scandals between 2000 and 2002.