Agree and disagree. Hedge funds are not supposed to “beat the market”. They’re supposed to deliver some beta (maybe) and some alpha (definitely). Outperform in bear markets and underperform in bulk markets. Unfortunately the average hedge fund does not even clear that low bar.
I roughly think of it as 1990-2000 lower risk, higher return 2000-2010 lower risk, same-ish return 2010-2020 lower risk, lower return (this is for long/short equity, other strategies may be a bit different but generally have declining alpha too)
