On the eve of the SEC's Sept. 15 deadline for comments on whether hedge funds should be required to register, Hennessee Hedge Fund Advisory Group of New York has issued its 10th annual hedge fund study, once again claiming they are not the wildly risky investments that they are made out to be. Nor, Hennessee claims, are hedge funds a threat to the financial system.

As proof of hedge funds' relative conservatism, the study pointed out that 85% of these funds have never leveraged more than two times capital and that portfolio turnover averages about 300%. Meanwhile, hedge funds have generated an annualized return of 15.34% with 40% less volatility than the S&P 500 return of 12.11% over the same time period, the study said.

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