Hedge Funds Down 4% In August, Big Names Hit Hard

August isn't quite over yet, but when it is, it will almost certainly go down as one of the worst months in hedge fund history.

The average hedge fund is down 4.1% this month, according to Hedge Fund Research. That means that, barring a remarkable rally between today and Wednesday, August will be the worst month since the collapse of Lehman Brothers and one of the five worst months since 1990.

Stock managers have been hardest hit, losing an average of 6.9%, HFR said. The declines have burned some of the industry's biggest names, among them Paulson & Co., one of whose funds was down almost 22% through the first three weeks of the month.

Few, if any, hedge funds have matched that precipitous drop. But many are nursing big losses of their own, including Owl Creek Asset Management, Perry Capital and York Capital Management, the Financial Times reports.

Others suffering include Highbridge Capital Management's long/short equity strategy, down 9.2%, Cantillon Capital's Global fund, down 6.25%, and Viking Global Investors, down 4%.