The S&amp;P 500 returned 32.4% in 2013, which proved a tough benchmark to beat.
According to data from Goldman Sachs' Amanda Sneider, the average core large cap mutual fund came close returnin 31.6% in 2013. 
But hedge funds only returned a measly 9.8% on average in 2013.
Much of this underperformance can be blamed on short positions in these funds. In fact, a basket of hedge funds' "Very Important" long positions returned a whopping 41%. 
Check out the distribution of hedge fund performance from Goldman Sachs:
<div class="KonaFilter image-container"><div class="image"><img src="http://static3.businessinsider.com/image/530758df6bb3f7d240147720-1107-691/screen%20shot%202014-02-21%20at%208.30.01%20am.png?maxX=800" border="0" alt="hedge fund 2013 returns" width="800" />Goldman Sachs</div></div>

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Hedge Funds Got Totally Smoked In 2013

The S&amp;P 500 returned 32.4% in 2013, which proved a tough benchmark to beat. According to data from Goldman Sachs' Amanda Sneider, the average core large cap mutual fund came close returnin 31.6% in 2013. But hedge funds only returned a measly 9.8% on average in 2013. Much of this underperformance can be blamed on short positions in these funds. In fact, a basket of hedge funds' "Very Important" long positions returned a whopping 41%. Check out the distribution of hedge fund performance from Goldman Sachs: Goldman Sachs

The S&amp;P 500 returned 32. 4% in 2013, which proved a tough benchmark to beat.

Hedge Funds Got Totally Smoked In 2013

Steven Perlberg

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