Forbes – Three hedge-fund heads discuss funds’ performance over the last year and debate potential tax code changes.

Funds Lost Their Hedge? David Serchuk: OK, everybody, thank you for meeting with us today on the Forbes.com Intelligent Investing Team. It’s a panel of hedge fund managers, so we are going to get rolling. Question one, something that should be very near and dear to your hearts: Have hedge funds lost their hedge? Why not just go for a cheaper, traditional money manager instead of your lot?

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Tags: forbes, hedge funds, hedge-fund-managers, traditional-money

Reuters – Hedge fund and traditional money management firms hard hit by last year’s market meltdown are poised for a surge of mergers and acquisitions to bolster depleted assets and widen sources of revenue.

"We’re going to see a massive wave of consolidation across the entire asset management industry, over the next 12 to 24 months," Brian Reilly, Barclays Capital’s head of asset management investment banking, told a gathering of hedge fund executives at the SkyBridge Alternatives Conference.

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Tags: asset management industry, assets, barclays, barclays capital, brian reilly, consolidation, hedge fund, investment-banking, market-meltdown, massive wave, mergers and acquisitions, money management firms, reuters, s-market, traditional-money

CNN Money – Third Point Management, a New York hedge fund run by one of the country’s most outspoken and controversial investors, has come under investigation from the Securities and Exchange Commission.

The $5.6 billion fund, whose founder Daniel Loeb is well known for his pointed regulatory filings targeting chief executives he deems underperforming, informed investors in a letter last month that it has been notified that the SEC has commenced a formal investigation into its communications with other hedge funds.

The SEC’s investigation into Third Point comes at a time when hedge funds are being criticized for playing a key role in the trading of various companies as well as in the continuing financial crisis. The SEC is investigating the actions of up to 50 hedge funds in the collapse of Bear Stearns and in the continuing troubles of Lehman Brothers and mortgage guarantors Fannie Mae and Freddie Mac.

According to reports, the SEC is investigating whether hedge funds knowingly and intentionally spread falsehoods about the financial strength of these – and other – brokers and banks. According to Institutional Investor magazine, which broke the Third Point story Tuesday, Loeb told investors that the communications were uncovered during the course of a routine audit last year after Third Point became a registered investment adviser.

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Tags: american-international-group, calpine-corp, cliff-asness, deviations, eliot-spitzer, feeder, lehman-brothers-holdings, loan-sales, massachusetts-secretary-of-the-commonwealth, new-marketplace, sphera, stock-fund, traditional-money