|S&P 500||-1.70%||-4.39%||-4.39%||Large-cap stocks|
|Nasdaq Composite||1.22%||0.12%||0.12%||Large-cap tech stocks|
|Russell 1000 Growth||-0.46%||-2.88%||-2.88%||Large-cap growth stocks|
|Russell 1000 Value||-2.67%||-5.03%||-5.03%||Large-cap value stocks|
|Russell 2000 Growth||-2.67%||-5.32%||-5.32%||Small-cap growth stocks|
|Russell 2000 Value||-3.36%||-6.09%||-6.09%||Small-cap value stocks|
|MSCI EAFE||-2.39%||-6.27%||-6.27%||Europe, Australasia & Far East Index|
|Lehman Aggregate||1.38%||1.47%||1.47%||U.S. Government Bonds|
|Lehman High Yield||1.23%||4.60%||4.60%||High-yield corporate bonds|
|Carr CTA Index||4.79%||10.22%||10.22%||Managed futures|
|Through February 28, 2003.|
Since the early 1980s, large family offices have been in the forefront of alternative investing. This group pounced on hedge funds and managed futures years before institutions even started considering them, and today are often the first investors in fund startups. And there’s ample evidence to suggest that the super-rich have been able to maintain their wealth through their commitment to top-performing hedge funds even as their less fortunate brethren saw their portfolio values drop precipitously during the persistent bear market.
Not wanting to miss out on an investment that the ultra-high-net-worth folks have been exploiting for years, the so-called ‘mass affluent’ demographic–those with a liquid net worth of $1 million, including real estate–have become increasingly interested in hedge funds. With about 2.1 million such investors in the U.S., the potential payoff to hedge fund marketers is enormous. But the real question concerning the democratization of the alternative investment industry is whether both groups of investors–the super-rich and the mass affluent–will enjoy the same experience going forward.