U.S. Hedge Funds Beat U.S. Equity Mutual Funds, S&P 500 in July; Emerging Markets: Lands of Opportunity & Disaster.

NASHVILLE, Tenn.--(BUSINESS WIRE)--Aug. 19, 1998--The average U.S. hedge fund significantly outperformed the average U.S. equity mutual fund and edged out the S&P 500 during July, George P. Van, chairman of Van Hedge Fund Advisors International, Inc. (VAN), a leading hedge fund investment advisory firm, said today. Various hedge funds that specialize in emerging markets were among both the month's best and worst performers, he added.

"The average U.S. hedge fund lost 0.8% and the average Offshore hedge fund gained 0.3% during July, while the average U.S. equity mutual fund lost 2.6%, the S&P 500 lost 1.1% and the average U.S. bond mutual fund gained 0.3%," Mr. Van noted. "Given the considerable volatility that the U.S. and international markets have been experiencing lately, it's comforting to see that the numbers didn't dip too far into negative territory and that hedge funds on the whole appear to be succeeding in their efforts to protect investor capital during these times of extreme global economic duress.

"Volatility, opportunity and danger were the hallmarks of emerging markets and the hedge funds that specialize in them during July," he went on to say. "Both the best and the lowest performing hedge funds for July in our databases specialize in emerging markets, with the former returning over 30% net to investors in July alone, while the latter lost over 15%. Of the 20 best performing hedge funds for July, 15 specialize in emerging markets, with most of these being Offshore Emerging Markets hedge funds. At the same time, only four Emerging Markets hedge funds, all Offshore, appeared in the 20 lowest performing hedge funds worldwide."

For July, the following were the best performing hedge fund investment styles: Offshore Short Selling (+3.5%), Offshore Emerging Markets (+2.6%), Offshore Macro (+1.7%), U.S. Distressed Securities (+1.7%), and U. S. Short Selling (+1.7%).

Year-to-date through July, the best performing hedge fund investment styles world-wide were as follows: U.S. Market Timing (17.0%), Offshore Aggressive Growth (+14.5%) and U.S. Several Strategies (+11.9%).

For July and year-to-date through July 1998, hedge fund returns by investment style were as follows: -0-

                         U.S. HEDGE FUNDS      OFFSHORE HEDGE FUNDS

                        July 1998  YTD 1998    July 1998   YTD 1998

Aggressive Growth          -2.2%      11.8%      -1.7%       14.5%
----------------------- --------------------    -------------------
Distressed Securities       0.8%       7.1%       0.2%        8.6%
----------------------- --------------------    -------------------
Emerging Markets            1.4%     -12.8%       2.6%      -13.6%
----------------------- --------------------    -------------------
Fund of Funds               0.4%       6.1%       0.4%        8.6%
----------------------- --------------------    -------------------
Income                      0.6%       5.6%       0.5%       -1.2%
----------------------- --------------------    -------------------
Macro                      -2.4%       6.3%       1.7%        9.7%
----------------------- --------------------    -------------------
Market Neutral
 - Arbitrage                0.2%       7.5%       0.4%        6.0%
----------------------- --------------------    -------------------
Market Neutral
 - Securities Hedging       0.3%       6.9%      -1.5%        4.5%
----------------------- --------------------    -------------------
Market Timing              -0.9%      17.0%      -0.6%        2.9%
----------------------- --------------------    -------------------
Opportunistic              -0.6%       9.1%      -0.9%        2.3%
----------------------- --------------------    -------------------
Several Strategies          0.2%      11.9%       N/A         N/A
----------------------- --------------------    -------------------
Short Selling               1.7%      -1.7%       3.5%       -3.6%
----------------------- --------------------    -------------------
Special Situations         -1.3%       7.4%      -0.7%       11.5%
----------------------- --------------------    -------------------
Value                      -2.2%       7.5%      -1.1%        8.0%
----------------------- --------------------    -------------------
Van Hedge Fund Index       -0.8%       7.6%       0.3%        1.8%
----------------------- ---------------------   -------------------

Van Hedge Fund Advisors International, Inc. provides monthly hedge fund returns, as well as other hedge fund information, at www.vanhedge.com. A sister company maintains one of the largest data banks of hedge funds in the world, with over 4,000 hedge funds. The primary database contains detailed information on over 2,600 hedge funds (approximately 1,500 U.S. funds and 1,100 Offshore funds) that manage over $140 billion in assets; the secondary database contains basic information on approximately 1,400 funds. The company has obtained assistance from faculty of the Vanderbilt University Owen School of Management to help ensure the statistical validity of its hedge fund research.

A registered investment advisor, Nashville, Tenn.-based Van Hedge Fund Advisors International, Inc. introduces top-performing hedge funds to substantial investors in the U.S. and abroad.

The Company's information on hedge funds is based on information received (and not audited or independently verified) from the hedge funds in its databases and may not be representative of all hedge funds. Different statistics may be based on different numbers of funds. Averages are not dollar-weighted. Past results are not necessarily indicative of future performance.

Database Reference: Investments, Hedge, Funds, Finance, Mutual Funds, Futures, Derivatives, Stocks, Bonds, Currencies, Commodities, U.S. Hedge Funds, Offshore Hedge Funds, Market Neutral.

CONTACT: Van Hedge Fund Advisors International Inc., Nashville

George P. Van, 615/661-4748

e-mail: [e-mail]

www.vanhedge.com