Hedge funds prospered in March despite volatile markets and the war in Iraq, according figures from the CSFB/Tremont hedge fund index, which was up 0.26% over the month.

Oliver Schupp, president of CSFB Tremont, said: "Markets were very volatile as the war in Iraq resulted in a reversal of the initial sell-off. Seven out of 10 hedge fund strategies provided positive returns despite a very difficult trading environment and increased concerns about the economic recovery."