Lawrence C. Strauss and Jack Willoughby in Barron’s lead a roundtable on the state of the hedge fund industry. Relatively muted returns this year are only of the crosscurrents affecting the hedge fund industry. The article is too long to summarize, but for investors interested in the issues surrounding the performance of hedge funds can take a look for themselves.

Riva D. Atlas and Mary Williams Walsh in the New York Times note the trend of pension fund managers placing increasingly large portions of their portfolios into hedge funds. Most funds have modest stakes in hedge funds, but a number have placed a significant part of their portfolios into hedge funds.

The crux of the matter is whether pension funds, whose benefits are implicitly or explicitly guaranteed, should be investing in private, opaque funds. Hedge fund managers are attracted to pension funds due in large part to the stickiness of their capital.

“It’s very inappropriate when the company is offering a pension plan that is guaranteed by the federal government,” said Zvi Bodie, a professor of finance and economics at Boston University who is enthusiastic about hedge funds in other contexts.

Geraldine Fabrikant in the New York Times brings the issue of hedge funds down to the level of individual investors. Professional investors, like David Swensen of Yale, have successfully invested in hedge funds for some time. The question is whether they are appropriate for all but the most wealthy and sophisticated individual investors.

The trend has been to make hedge fund strategies, often through fund of funds, available to more individual investors. The problem is that fund of funds have shown poor returns relative to the universe of hedge funds.

“Funds of hedge funds generally aren’t a good investment for the unsophisticated investor,” he [Swensen] said. “The best hedge funds aren’t included in them, and the fees are too high.”

On this same general theme, Roger Nusbaum feels that rather embrace the cost and complexity of hedge fund like strategies, most investors would be better served by embracing simplicity. The explosion of ETFs, some of which follow novel strategies, allows individual investors to create simple, low cost portfolios without the help (or cost) or paid advisors.