The conventional wisdom at the moment is that long-short funds are in heavy demand. According to Morningstar, about 90 money management firms offer more than 200 products applying a 130/30 or 130/30-like approach to a host of products, hedge funds, mutual funds, SMAs, exchange traded funds and others. But a Morningstar analysis has also found that some funds are taking on a lot of risk for mediocre returns. The study analyzed the returns of 40 different 130/30 strategies over a 12-month period, and found a beta range from 3.5 to a negative 1.25, reports Investment News. Of course you would want a beta in line with the appropriate index. So the message here is that not all 130/30 funds were created equal. There is a lot of leeway, and managers that fall behind may be tempted to catch up with some additional risk.

For more:
- here's the article [1]

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