December Performance Update: It was probably fitting that 2011, having tested investors for most of the year, ended with yet another negative month, dragging the ASX200 down 14.51% for the year.  As can be seen from the table above, Australian absolute return and hedge funds managed to soften some, but not all of the decline, recording only the second annual fall in the past 10 years.

Inevitably equity based funds suffered most, with investors in concentrated, high conviction funds bearing the brunt.  On the positive side 90% of funds outperformed the ASX200 over the past 12 months, with close to 50% in positive territory.  Meanwhile the AFM E5 Model Portfolio returned 16.98% for the year, in line with its annualised return of 16.91% over the past 5 years, with a volatility of just 5.71%.