By Susan Barreto
Hundreds of column inches have been written on Bernard L. Madoff since the fateful unveiling of the Ponzi scheme in early December. Fatigue on the subject has definitely set in. Whether or not lessons have been learned remains yet to be seen, but the one thing crystal clear for the funds of funds industry is that "cocktail party" hedge fund investing is finally over.
The age of "institutional" hedge fund investing, with the transparency and dialogue end investors expect from the providers they pay for, has arrived in funds of funds land. It will be the only way that end investors will open their purse strings again to invest in funds of hedge funds after so many ignored the apparent red flags (see box right), to lose $18 billion over night.
More than 60 institutional investors have found themselves with exposure to Madoff, either directly...