What's on investors' minds…

US institutional investors have placed blow-up risk surprisingly low on their list of greatest concerns. Higher up on their list of fears was diminishing returns with greater inflows, high fees and some consultants' unwillingness to recommend smaller and emerging managers.

Institutions' own tardiness coming to the hedge fund party, in some cases, has also raised investment boards' eyebrows.

Michael Hennessee, managing director of foundation and endowment advisory firm Morgan Creek Capital Ma