David Einhorn's Greenlight Capital L.P. returned 15.9% in 2010
. Usually financial websites compare hedge fund returns to major stock market indices, such as the S&P 500. However, they forget that some hedge funds are at least partially hedged and their market beta is nearly half of the general market's beta. Greenlight Capital's market beta is around 0.5, meaning if they didn't have any stock picking skill, they would have returned about half of the market's return. That's not David Einhorn
's problem- he managed to beat the market again this year, even though the fund assumed less risk.
Einhorn's Greenlight Capital
L.P. returned 36.9% in 2009, beating the S&P 500 index.
For those of you who are interested in learning David Einhorn's investment style
, we recommend reading his book, Fooling Some of the People All of the Time