After posting gains of as high as 65% in 2005, hedge funds that invest in Japanese securities are suffering steep declines, The Wall Street Journal reports.
The Whitney New Japan Fund--a hedge fund run by
And the red ink appears to be widely across the board, according to data from
One of the problems, analysts said, is that hedge fund portfolio managers in Japan invest like mutual fund portfolio managers, holding stocks for rather long periods of time, rather than offsetting their risk by shorting the market.