Benefiting from the ups and downs

'Hedge funds are changing the traditional investment landscape. They increase volatility in stock markets, buffet share prices and scare shareholders into hasty and often unnecessary decisions. This is bad news for shareholders ' and for the 'long-only' managers of traditional mutual funds.'

So goes the argument from critics of hedge funds ' some of which include listed company CEOs. To a certain extent, the criticism is true ' hedge funds do add to volatility in certain situations. But is it all