A war in Iraq could make capital preservation tricky

US long/short funds are performing well compared with their peers in other jurisdictions, but managers note the potential for war in Iraq poses a threat to capital preservation.The overriding key to success in the current volatile market environment is disciplined risk management, according to Julian Wheeler, manager of Gulf International Bank's Falcon US Long/Short fund.Wheeler has maintained the Falcon fund on a broadly neutral stance between long and short positions investing on the basi