After enduring twists and turns in the latter half of 2011, a simple long/short fund makes a splash by sticking to the basics.

James Debevec, portfolio manager at Absolute Value Fund, has beat the S&P 500 at a return of nearly 23% in the fourth quarter of 2011, up from the latter’s 11%.

The half a million long/short value equities and commodities hedge fund launched in 2001, and doesn’t use derivatives or leverage. It also keeps a happy medium between long and short trades.

Absolute Value returned nearly 2% at year-end in 2011. Meanwhile long/short equity strategies at large were down by almost the same amount, according to the Dow Jones Credit Suisse Hedge Fund Index.

While Debevec doesn’t get into the too esoteric, he has a few assertions on how investors and traders should play commodities.

“Gold is now up at least 1% twelve years in a row,” he told Markets Media, noting that such a long-lasting trend compares only to one other commodity—natural gas, which went up 12 years in a row from 1971 to 1982.

Commodities have reigned supreme in 2011, as investor fear of market volatility would have it. United States Brent Oil, which tracks a basket of front-month Brent futures was also commodity king alongside gold, yielding a nearly 20% return in 2011. Next in line was United States Gasoline, which rose nearly 15% during the same period last year.

Are commodities the latest investment trend, at the ready for traders to make a quick buck, or are they truly protection against inflation, designed for long-term holding? Whatever your stance, Debevec is closely monitoring the short-term performance of precious metals’ second in command: silver.

“If silver closes January above $30.59, silver will have had an up/down 10% month in nine of the last twelve months which will be an all-time record,” he told Markets Media. Yet, per his top-down directional investment approach, Debevec isn’t expecting such highs to last.

“Silver’s annualized return in presidential election years since 1917 is -10%. Silver has had only two out of the last 23 presidential election years when it was up more than 5% and one when it was up more than 15%. At its bottom in the next decade, I expect silver to trade below fair value.”

Absolute is based in South Florida, an area long known mostly for its real estate investment potential and favorable weather. Yet, what about a favorable hedge fund climate? There are various associations domiciled in the region—the Florida Alternative Investment Association, and South Florida Hedge Fund Association, to name examples—all attempting to promote South Florida as the next great U.S. investment hub.

“It is logical for hedge fund management companies who specialize in Central and South American to set up their headquarters in South Florida,” Debevec said. “While South Florida won’t bump New York or Greenwich off the hedge fund mecca list anytime soon, it does have a market niche which is growing in importance.”