Goldman Sachs Tuesday denied it was liquidating its Global Alpha hedge fund, after rumors circulated that the fund was being wound down after falling 12% over the past two weeks. The fund's goal is to generate returns not correlated to the S&P 500, but its risk aversion is supposed to be similar to that of the large-cap index. Investors said the funds investments were liquid, and that it should be able to sell its holdings should redemption demands grow. After losing 7.7% in the week ended July 27, the fund is now -12.1% on the year, before fees, according to investors. In 2006, the Alpha fund lost 6%, after a robust 40% gain in 2005, and an average 15.1% since its inception in 1995. The loss comes as the hedge fund industry suffered its worst week in four years, with Hedge Fund Research's investable hedge fund index falling 3.01%. A Goldman spokesman declined to comment.
Sources: Reuters, MarketWatch
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