Are hedge funds a potentional threat to financial stability?

Abstract

This study aims to examine whether hedge funds are a potential threat to financial stability. In the light of financial crisis and systemic risk, the studies shows that hedge funds are not responsible for financial crisis. There is no evidence that hedge funds were a cause of financial crisis. In addition, hedge funds is not related to systemic risk, directly. Therefore, hedge funds are not a main culprit of financial instability in market disruption.