Does the existence of hedge funds do any good to the health of the equity market?

Hedge funds and mutual funds both manage significant portfolios of US/intl company stocks. Each strategy that they use has an advantage and disadvantage (trend following, arbitrage, macro, etc) that contribute to the overall market.

Are hedge fund traders merely wealth robbers in a sense?

Hedge Funds that short stocks help keep companies honest — versus mutual funds that have a long-only mandate (buy and hold, they cannot short stocks). I would disagree that they are wealth robbers. If they agree to buy a stock you are selling for $x, how is that wealth robbing? One thing that isn’t talked about much is how their large positions move the market. If a hedge fund is going to buy 10 million shares of a company, they will do it slowly over a period of a several weeks/months so as to not drive up their overall cost basis.