Double Black Diamond:

How bad was 2008’s decline in hedge fund assets under management?  According to the chart below from Pensions & Investments, it was somewhere between a single black diamond run and the storied Hahnenkamm at Kitzbuhel.  Still, this only puts the industry back to mid-2006 – hardly the very bottom of the slope (and not remembered as a particularly horrendous year for the industry).

But the bottom of this particular run may be near.  According to some pundits, we should know which scenario above is playing out pretty soon (the “Bullish”, “Base”, or “Bearish” case).  The head of hedge fund firm Thames River Capital told a conference audience recently that he thought the shakeout would end in June.  MIT’s Andrew Lo also suggests the same.  But other industry players say right month, but wrong year.  In any event, the head of UBS prime brokerage services says: More…