Hedge funds posted gains last month for the third month in a row, but their gains trailed the average U.S. stock mutual fund and the broader equities market.

The average hedge fund returned 1.98%, compared with 0.24% in September, according to data from Hedge Fund Research.

The average stock mutual fund gained 3.48%, according to data from Lipper, while the Standard & Poor's 500 index rose 3.15%.

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