Hedge Funds Post Significant Gains in November - 12/09/02

December 9, 2002 - New York, NY -- The Hennessee Hedge Fund Advisory Group

("Hennessee Group LLC"), a global hedge fund investment consulting firm, which advises individuals and institutions on over $1 billion in assets, today announced that hedge funds produced a positive return of +2.55% in November, according to the Hennessee Hedge Fund Index®. Though hedge funds were up for the month, their performance was surpassed by the broad markets
as the S&P 500 Index gained +5.85%, the Dow Jones Industrial Average rose +5.94% and the Nasdaq Index increased +11.21%. Year-to-date, hedge funds are down -2.56%, beating the broad US equity markets, as the S&P 500 is down -17.32%, the Dow Jones Industrial Average is down -11.23%, and the Nasdaq is down -24.17%. In addition, Lipper Mutual Funds are down -18.19%
year-to-date.

"Equity hedge fund managers were up almost +4.00% in November, their strongest month this year, indicating that the worst is behind us," said Charles Gradante, Managing Principal of Hennessee Group LLC. "However, we will likely give back 50% to 70% of our gains since our market low as unemployment, Iraq, and slow money supply growth remain issues," added Mr. Gradante.

November's lower volatility helped the equity markets to rally as the VIX index closed below 30 for the first time since June 26, 2002. High Yield hedge fund managers profited, posting a +7.40% return for the month, as default rates declined and spreads narrowed from 1100 basis points in October to 810 basis points in November. Healthcare/Biotech managers followed with a +4.66% return for the month as the sector rallied as a whole due to a high beta coefficient for most healthcare/biotech stocks.

The third best performing style for the month was Telecom/Media with a +4.20% return as improving confidence and high beta coefficients in the sector fueled rising stock prices.

"Convertible bonds experienced a significant tightening in credit spreads due to a decline in 5 Year Treasuries while the convertible bond floor appreciated, " stated Mr. Gradante. "The Hennessee Group expects convertibles to benefit in 2003 - a market where balance sheet restoration will be mandatory for survival," Mr. Gradante added.

Only three strategies were in negative territory for the month of November. Though they are still the best performers for the year to date, Short Biased hedge fund managers were caught in a strong market rally and had a return of (-3.37%). Market Neutral managers posted a decline of (-1.63%). Europe, the third worst performing strategy, lost (-0.50%) in light of a weak economic picture in most European countries, most notably Germany.

"As the economy and balance sheets improve in 2003, we expect to see increased merger activity where strong companies will deal for the weak," concluded Mr. Gradante.

About the Hennessee Group LLC

The Hennessee Group is a pioneer in hedge fund investments and currently advises on over $1 billion of assets invested in 125 different hedge funds. All portfolios are customized to fit each individual client's investment mobjectives and risk parameters. Emphasizing investment advice through "hands on" experience and direct access to our managing principals for client needs, the Hennessee Group's only client is the investor. The Hennessee Group does not market individual hedge fund managers or fund of
funds, nor is the firm a hedge fund tracking service.