Riding out the storm

Hedge funds, many of which are heavily invested in equities, have proliferated quickly in South Africa over the past few years. How has the recent spate of domestic stock market volatility affected the sector? By Clive Davidson

The boom in South African hedge funds over the past few years has taken place against the backdrop of an extended bull run in the country's equities market, continuing economic growth and political stability. At the same time, the absence of any specific hedge fund regulation means the industry was open to any entrepreneurial investment managers who thought they could turn a profit in a rising market.

That setting now looks very different. Since hitting a high of 31,531.05 on October 11, the