NEW YORK (TheStreet) -- Hedge funds are attempting to offset the past three years of downturn within their industry via the global market's decline after the U.K. referendum to exit the European Union.

The current dislocation in the market is fortuitous to Paul Graham, CEO of AlphaGen Capital.

"I think clearly over the next three years good old fashioned stock picking in a market that will see huge stock dispersion, weak correlations between sectors and markets oscillating around," Graham said on CNBC's "Power Lunch."

While Graham admits that it is "quite difficult" to ignore the macro view in this context, the most prosperous hedge fund managers will take a fundamental view on stock specifics.

"That's real, if you don't mind the term, sex, rock and roll and violence," Graham says.

He believes the following three years will be better for hedge fund strategies than index trackers and ETFs, saying "there should be clear winners and clear losers as a result of this market dislocation."

"It's just whether investors can stay along for the ride because ... there's a lot of criticism around the hedge fund industry. And jumping ship right now could be the worst possible time," Graham added.