Who hasn't heard of stories about the fabulous gains for hedge funds? Stories of great gains, fabulously wealthy "rock and roll" fund managers (someone even penned a book titled "hedge fund mistress"), and the occasional scandal.
However, an amazing statistic which Money magazine recently reported (and was pointed out to me), is that the average hedge fund has gained +6.8% for 2006, while the return on the S & P 500 for a comparable period has been +8.5%. Those are taxable returns which are not much better (even on a before tax basis) than the taxable equivalent IRR of a typical lifetime structured settlement. Think about that.. LOTS MORE RISK (in a hedge fund) for not much better 2006 average return.
Wrongful death survivors and others receiving large settlements (and their lawyers and legal advisors) should not automatically rule out a structured settlement in favor of a Wall Street money manager. Consider your options carefully. Structured settlements cannot be created after the release has been signed and delivered to the Defendant.
Leave a Reply