Reuters – Hedge funds have rallied from last year’s stunning losses, yet hundreds of managers remain deep in the hole and face some tough decisions in the coming weeks.

The fund industry suffered one of its worst years ever in 2008, when the average hedge fund fell by 19 percent amid tumbling markets exacerbated by record withdrawals.

Yet even as managers quickly mounted a comeback — the average fund rose 17 percent over nine months — roughly 10 percent of the industry’s 8,000 hedge funds may remain deep in the hole by year-end.

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Tags: hedge fund, hedge funds, high water, water marks

Forbes – Hedge fund managers (and would-be hedge fund managers) may finally have reason to celebrate this year — new fund launches are on the rise. If they keep up at this pace, it could be the first year since 2005 to show some annual growth in new fund formations.

This is on the heels of 2,100 hedge fund failures since the credit crisis. That some managers are dusting off and trying again could be a sign that the smart money sees some opportunity in the markets. It might also be that funds that had posted huge losses closed down so that the managers could start with fresh records, resetting high-water marks so that they can collect performance bonuses without making up the money lost in 2008.

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Tags: hedge fund failures, hedge funds, hedge-fund-managers, launches, performance bonuses, smart-money, water marks