I've noted that the big institutions still seem to be hungry for private equity investments, despite the recent turmoil. Does this hold for hedge funds, whose returns may be more volatile than private equity funds? For many pensions, this is a first foray into ups-and-downs of the industry. The AP notes that many funds have yet to go through a major down cycle. One can only hope that all institutions diversify themselves suitably so that no one fund blow up will hit its portfolio too hard. At a minimum, you would expect that pensions will stick with funds of funds. Just before the turmoil, CalPERS, whose gains have been stunning, announced it will double its investments in hedge funds to $10 billion. That's still a tiny percentage.

For more:
- here's the AP article