The Stock Market Is In a Bear Market, and Hedge Funds Finally Have Their Moment

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Some 40% of funds gained ground in February, and some were even able to deliver gains during the first part of March. Photograph by Alex Wong/Getty Images

With markets in chaos, hedge funds are having their show-me moment—and some are passing with flying colors.

The post-financial-crisis world hasn’t been kind to hedge funds. The industry’s performance lagged behind the S&P 500, causing critics to question its relevance, Now, with a bear market taking hold, the spotlight is on fund managers to show that they can provide the downside protection they’ve promised.