The two main players in the New Zealand market, Tower and OM Strategic, have both reported positive returns.

OM Strategic says that its nine funds have returned between 4.27% and 7.21% in August.

Likewise Tower's GAM Multi-Trading fund has posted positive returns in the wake of the attacks.

Tower Managed Fund general manager Richard Baker says the fund was up a net 2.68% in the week after the attacks.

"(This is) an excellent result providing proof positive of a good multi-manager hedge fund performing well in the most trying of times," Baker says.

He says one of the underlying funds, GAMut made money in commodities such as oil and gold which went up in price bonds and by being short in US shares.

Another underlying fund, Multi-Trading, made money in bonds by being long the short end and in shares from being short. This fund lost some money in currencies and had mixed results in commodities.

One of the big tests for hedge funds will come when monthly returns for indices are reported early next month.

FundSource executive chairman David van Schaardenburg says there is a place for hedge funds in a portfolio, however he warns that not all funds are the same.

For instance funds which use a short-selling strategy are likely to have benefited as prices fell.

"There's a role for alternative investment strategies irrespective of what's going on."

Tower Asset Management chief executive Paul Bevin says the results from hedge funds will be mixed at the moment.

"No one can predict this kind of event so if a hedge fund did well it would be lucky. And if it did badly it would be unlucky."

While a number of equity raising issues have been cancelled in the wake of the attacks OM Strategic and Challenger-owned Blue Peak are still planning to launch new hedge funds next month.