We noted recently that Citadel, which had focused its efforts on its big macro fund, now aims to offer smaller funds within set style categories. AllAboutAlpha.com notes that this trend seems to have been underway for quite a while. It references a recent scholarly paper by Nicole Boyson of Northeastern University showing that while there may be more than 10,000 hedge funds out there, the number of hedge fund firms (or families) is much smaller--no more than 4,000. Fund firms have not been growing at nearly the rate of actual funds. In general, there has been surprisingly little study of this phenomenon and its effect on performance. Can a firm do well in multiple styles? Does his tax investors? In any case, this is surely another case of hedge funds following mutual funds. Say what you will about that.

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