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These are tough times for hedge funds. Earlier this year when the credit crunch showed no sign of easing, one industry insider predicted that between half and two thirds would not see out the year.
They might not have actually closed in that time, but they would have been so disabled and their credibility with investors so shot that they would be all past but no future.
Even the best names with the most glittering records are not immune. Some, of course, such as Peloton have already blown up but it is the long, slow declines that tell a more dramatic story.
The struggles of one of the best, RAB Capital, to overcome a period of poor performance are watched with morbid fascination by the rest of the industry — if only to see whether it will be able to retain sufficient loyalty among clients to hold on to enough assets to trade through.
Some think it must; others fear it can't. But the lesson is that if RAB's record is not enough to keep clients loyal, it bodes ill for any others who fall on a bad patch.
Such patches are not far away, for there is a veritable catalogue of woe elsewhere. The collapse of Lehman is upsetting for GLG Partners, among several others, because the bank was a major shareholder.
It was doubly unwelcome for GLG, coming on top of the departure of Greg Coffey, one of its high-profile managers.
In passing, it will be interesting to see how much money Coffey raises for his own venture, given the current mood of the markets.
Elsewhere, the new owners of other investment banks may show less interest in prime brokerage as a source of revenue, given the changing nature of the financial markets, and therefore be less indulgent towards hedge-fund clients in the future.
Meanwhile, the sharp falls in oil and other commodity prices are known to have caught out several of the funds most active in that area.
Last week, one of the industry's key figures, Stanley Fink, having quit at the top of Man Group a couple of years ago, decided to go back in. But he was careful in his choice of employer — selecting a small and relatively nimble group, and one whose global macro strategy gives it the world from which to seek its opportunities.
That end of the boat should be fine, he mused, but he thought there would be a lot of wet feet down at the end housing the highly leveraged and the long-short equity funds.
The challenge to those reliant on leverage is self-evident in that not only has credit dried up in absolute terms while its cost has soared but also the number of investment banks even willing to consider it has dwindled sharply.
As for the strategy based on going long and short of equities, the problem brought into brutal focus last week was that times of huge volatility actually make the job well-nigh impossible.
Any fund that was short of HBOS — and it must surely have been most of them — risked being caned by the terms of the rescue from Lloyds TSB, which were roughly double the prevailing share price.
Those who then thought the deal made Lloyds a target and sold it down to 235p on Thursday must likewise have been savaged by the 35% jump in its price on Friday in the wake of the FSA's new restrictions to curtail short sales.
More generally, the value of the S&P 500 in the United States moved by 35% in one day. Riding that kind of move successfully takes luck, not skill. But then much of what appears to be skill is so often luck. The hardest thing in choosing a fund manager is to be able to distinguish between genius and a bull market.
The professionals appear to find this as hard as everyone else. The antidote to the problems of individual funds has always been to buy a spread, which is most easily if expensively done by investing in a fund of hedge funds.
Interestingly, however, even these experts in the thick of the action have had trouble keeping ahead of events. They have been caught by restrictions on liquidity imposed by funds to stop a wave of redemptions, and therefore been forced themselves at times to sell what they can, not what they would like to.
Their key claim that they offered returns uncorrelated with other assets classes looks distinctly threadbare. At a time when everything has headed south, they have too.
