Value of hedge funds is to creat jobs
I was just talking to my friends a few days ago. He used to work at a hedge fund that was shut down recently due to poor performance.
He told me 80% of hedge funds don't beat indices, and felt like value of hedge funds lie in CREATING JOBS for hedge fund managers / analysts, sell-side analysts and bank employees that serve hedge funds, as well as LPs that invest in hedge funds.
Is the statistics right? Can hedge funds even beat indices? Is absolute return really absolute?