Forbes – Despite record numbers of hedge funds closing up shop last year, firms continue to be lured to the business.<\/p>\n
Earlier this week, Kohlberg Kravis & Roberts<\/strong> announced plans for a new distressed debt-focused fund, to be rolled out Jun. 30 with an initial $1 billion in assets. It becomes the latest private equity firm to jump the fence and join the hedge fund crowd. Carlyle Group<\/strong> has operated a $3 billion hedge fund since 2004 and Blackstone Group<\/strong> started a $500 million fund last year.<\/p>\n Just about every investment bank is figuring out ways to capture a bigger piece of the hedge fund pie, as well. Morgan Stanley<\/strong> (nyse: MS<\/a> – news<\/a> – people<\/a> ) is said to even have held discussions about taking a stake in Frontpoint Partners<\/strong>, a $6.4 billion fund in Greenwich, Conn. In the last year, JPMorgan Chase<\/strong> (nyse: JPM<\/a> – news<\/a> – people<\/a> ) has taken a sizeable stake in Highbridge Capital<\/strong> while Lehman Brothers<\/strong> (nyse: LEH<\/a> – news<\/a> – people<\/a> ) bought 20% of Ospraie Management<\/strong>.<\/p>\n Continued enthusiasm for the sector comes despite evidence that funds are struggling for survival.<\/p>\n