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Before you are able to access the Congressional Testimony please read the following disclosure and click the "I Agree" button to continue.

Congressional Testimony Disclosure Statement

Attached is my testimony before the U.S. House of Representatives in a recent hearing entitled "The Long and Short of Hedge Funds: Effects of Strategies for Managing Market Risk" held by the Subcommittee on Capital Markets, Insurance and Government-Sponsored Entities.

In the testimony, I provide a general discussion of the creation, development and features of the hedge fund market and generally describe investment strategies and investment products available today. Please remember that this is a general discussion which does not attempt to cover the universe of issues an investor should consider before investing in hedge funds. Not all products described in my testimony may be suitable for all investors. Prospective investors should carefully consider, among others points, fees, expense arrangements, liquidity rights, investment objectives, and conflicts of interest before investing.

In my testimony, I do not endorse any particular hedge fund investment strategy as suitable for any specific investor or investors. In fact, I strongly advocate that only investors who have educated themselves regarding the risks inherent in an investment in hedge funds, and can assume those risks, should be permitted to invest in the products, assuming an appropriate regulatory regime.

To illustrate my position, my testimony compares the performance of different investment vehicles against a hedge fund index or the performance of certain hedge fund indices against the indices of various investment products. Indices are unmanaged and are generally representative of certain portions of a specific market, such as the U.S. equities or bond markets. These indices are mentioned for illustrative purposes only and are not indicative of the performance of any particular investment. An investor cannot invest directly in an index. Moreover, indices do not reflect commissions or fees which may be charged to an investment and which might materially affect the performance data presented.

Also, there are material differences between the products which comprise the indices. Hedge funds, equities, mutual funds and bonds have different liquidity rights, may be subject to different risks and regulatory scrutiny, and suffer varying degrees of volatility. Equities and mutual funds are subject to market risk, yet may offer substantially greater liquidity and transparency than hedge funds, and may be less costly to purchase. Bonds benefit from U.S. government guarantees on the payment of principal and interest and are susceptible to interest rate risk. Hedge funds have significant fees, are not publicly traded, are not registered with the U.S. Securities and Exchange Commission, are generally unregulated, and have significant liquidity restrictions, among others. Please refer to "Risks" for a more complete discussion of certain risks associated with an investment in hedge funds.

While there are potential benefits associated with the management and investment techniques of certain hedge funds, no hedge fund investment strategy is without risk and no particular strategy or technique can guarantee performance. As with any investment, the past results of any investment product are no guarantee of future performance. Investors can and do lose money investing in hedge funds, and there is the possibility of losing an entire investment in a hedge fund.

I have read the important disclosure above and have consulted the section "Risks" for a more complete discussion of the risks associated with an investment in hedge funds.