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NOT SO HEDGED

A lot of hedge funds failed to implement the hedging portion of their investment strategy in 2008.  Of course every hedge fund uses different strategies and it’s not unusual for many of them to be completely unhedged (such as Eddie Lampert’s ESL which is entirely invested in Sears and a few other small investments).  Nonetheless, many of them lost substantial money last year:

The investors include billionaire oilman T. Boone Pickens, who lost $450 million as his fund, BP Capital MGMT, dropped 60% and investors pulled about two-thirds of their assets; and billionaire investor Carl Icahn, who lost $400 million as his firm, Icahn Enterprises LP, lost 35%, mostly from its holdings of Yahoo Inc. and Motorola Inc.

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