Do energy hedge funds need cutting down to size?

Energy hedge funds took a big hit on wrong bets on natural gas this month when cooler-than-expected weather reduced demand for air conditioning and sent prices tumbling. In the less regulated world of hedge funds, it is hard to measure the exposure of these risk-tolerant funds to the energy complex. Over $10 billion in losses have been made public, based on reports from just three or four of the more than 500 funds in the energy hedge fund universe.

Despite concerns of systemic risk, an expected

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