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Choppy August tested hedge funds, and many stumbled

Longer term, such funds have underperformed benchmarks over five- and 10-year periods

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An investor looks on at a digital board showing stock market movements at a brokerage house in Shanghai. Global stock markets will be on edge this coming week Sept 7, 2015.

A SURGE in volatility. Plunging global stock markets. A surprise Chinese currency devaluation.

That was August, among the more eventful months for world markets since the collapse of Lehman Bros and the 2008 financial crisis. In theory, that's exactly the environment that hedge fund

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