Hedge funds are shifting their focus towards attracting 'mini-millionaires' as traditional institutional investors become more cautious. This trend reflects a broader strategy among hedge funds to tap into smaller investors for capital, particularly in the face of challenging market conditions. While certain hedge funds have outperformed the S&P 500 during downturns, the average performance of hedge funds has been competitive with Treasury bills. Analysts note that, although some hedge funds have shown strong returns, they often do not significantly outperform index funds. This change in strategy may indicate a need for hedge funds to diversify their investor base and adapt to evolving market dynamics.