Debt aids recovery

Global emerging markets hedge funds have demonstrated a measure of recovery in the 12 months to August despite difficult market conditions. But in general the funds show poor returns over a turbulent three-year period with all segments, from Asia through Eastern Europe and Latin America, experiencing severe losses.

In the past year the 22 funds in the emerging market sector tracked by S&P Micropal managed an average rate of return of 19.6%, and an average maximum drawdown of 14.7%. Volatili