The resurgence of hedge funds this year has been often noted. To put it in perspective, recall that in the 12 months following January 2008, roughly $1 trillion was withdrawn by investors. The damage was massive. But since January of this year, the industry has staged a remarkable recovery. Reuters now reports hedge fund assets have once again crossed the $2 trillion level--the first time in a year.

Investors have added money to these fund for eight months in a row. Fortress CEO Dan Mudd sees a spike in demand. Strong performance has been key. So far this year, Hedge Fund Research says hedge funds have returned nearly 19 percent. We've noted that a decent December will give the industry its best returns in a decade. One interesting horse race to keep an eye on: Will hedge funds beat the S&P 500? Right now, it's pretty close. 

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