Moreover, expense percentages at some funds have been rising as a faltering stock market leaves them with a smaller asset base over which to spread costs.
The faltering stock market meant the state had to make a $44 million contribution to the state pension fund.
According to Dr. Schiller, Progeia faltered because funds intended for research had been creamed off by the cats, or cat, at the top.
But last year, when G.D.P. growth faltered, the fund made a great deal of money betting on Treasury bonds and other securities that tend to do well in a weak economy.
WORLD economic growth is faltering, the International Monetary Fund said this week, as it forecast that most of the large developed economies would either shrink this year or grow at paltry rates of 2 percent or less.
The ability to generate positive returns at a time when most financial investments were faltering suggested that hedge funds had lived up to their name: they had provided valuable hedges.
Meanwhile, private-equity funds save faltering companies that might otherwise go bankrupt, frequently by taking a public company private and, after restructuring and reorganizing it, returning it to public ownership through an I.P.O.
In 2008 managed-futures funds (the class into which AHL falls) returned an average of 18.2% while the typical fund of hedge funds lost 19.8%, according to Eurekahedge, a data provider.But the faltering performance of managed-futures funds last year shows that computer-driven strategies are far from perfect.
For the last few years, market analysts and some seasoned money managers had been predicting that the highflying mutual funds, which amassed colossal returns for much of the decade, would soon falter, yet the funds continued to surge as demand for commercial real estate remained strong.
Once lauded money man worth $2.7 billion just 2 years ago feeling pain as his funds falter.
