Apparently they didn’t – their managers did. I have written about this disconnect before, here and here
There is a remarkable and somewhat unsavoury difference between what the people who run hedge funds make and what the people who invest in hedge funds make.
As an example consider that you are a manager of a $5 billion dollar fund that in a given year makes 10%.
Managers return @ 20% management fee = $5 billion x 10%/20% = $100,000,000.00
Investors return with $1,000,000 million in fund = $1,000,000.00 x 10% = $100,000.
However this is not a true picture because the investor only makes $80k because the manager takes 20% of all profits.
An index fund is looking pretty good at this stage,