Hedge Funds Struggle Amid Manager Scandals | Commentary | Financial Articles & Investing News | TheStreet.com

<a href="http://www.thestreet.com/story/10775197/1/hedge-funds-struggle-amid-manager-scandals.html?cm_ven=GOOGLEFI">Hedge Funds Struggle Amid Manager Scandals | Commentary | Financial Articles & Investing News | TheStreet.com</a>: "Some of the biggest victims of the Madoff scandals were investors who relied on vehicles known as funds of hedge funds. Hundreds of millions of dollars vanished from funds of funds run by Maxam Capital Management and Tremont Group Holdings. More from Stan Luxenberg<br />Mutual Funds That Make Best of Weak MarketsValue Mutual Funds Pile Into Growth StocksHow Index Funds Distort MarketsShaken by the losses, investors fled funds of funds. Withdrawals totaled $158 billion in 2008 and 2009, according to industry tracker Hedge Fund Research. <br />Part of what unnerved investors was that funds of funds had long been seen as relatively safe choices. The funds typically collect money from investors and put it into a pool that includes 20 or more hedge funds. The aim is to provide broad diversification. Funds of funds claim to offer security because professional managers pick the hedge funds that go into the portfolios."

Hedge Funds Struggle Amid Manager Scandals | Commentary | Financial Articles & Investing News | TheStreet.com

Hedge Funds Struggle Amid Manager Scandals | Commentary | Financial Articles & Investing News | TheStreet.com : "Some of the bigges...

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