Hedge funds investing in emerging markets have proved that it is a lucrative business, by outperforming their benchmarks this year, The National Post reports. Hedge Fund Research Inc. reported that hedge funds investing in emerging markets delivered returns of 14.7% in the first nine months of the year through September, as tracked by the HFRI Emerging Markets Total Index. This number contrasts with the 7.3% increase in the HFRI Fund Weighted composite index in the period.

This year's performance is keeping pace with the two previous years. The emerging market index gained 18.42% in 2004 and 39.36% in 2003.

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