Hedge funds may have an aura of exoticism and modernism, but their goals are as old as the art of investing itself. They seek a positive annual return (the higher the better), limited swings in value, and, above all else, capital preservation. They do so by using the best of what modern financial science can provide—rapid price discovery; massive mathematical and statistical rocessing; risk measurement and control techniques; and leverage and active trading in corporate equities, bonds, foreign exchange, futures, options, swaps, forwards, and other derivatives.