As a result, while their returns will generally be lower in rising asset markets, hedge funds can come into their own in falling ones.
And with the hedge fund industry having lured away many of the financial world's top brains with huge performance-related salaries, Schulman is convinced hedge funds are here to stay.
"It's a growth industry. It might trail off a little if equity markets pick up but if they stay where they are it will probably continue," he said.
But a word of warning for any would-be investors.
The majority of funds are unlikely to be interested unless you happen to have a million dollars to spare.
"In practice some of the less-established funds have been struggling to get money in, but even they probably don't want to know unless you've got at least US$100,000," the hedge fund manager said.
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