A broad spectrum of participants are buying up gold as it sits at record highs, all hoping to add a little glitz to their portfolio. To be sure, some of the gold demand is from jewelry fabricators or buy-and-hold type investors such as those who purchase small bars and coins. But a large chunk is also coming from those who move in and out of the market more often. The sharp gains in gold -- up about 26% on the year -- have made it all the more alluring to these speculators who do not need physical metal and are making short-term bets on price direction. "All told, investors poured $552 million into gold bullion ETFs in October," a Morningstar report said. Some hedge fund managers who have been spotlighted for their investment in gold include John Paulson at Paulson & Co. and Greenlight Capital's David Einhorn. Mr. Paulson at one point this year held nearly 9% of the SPDR Gold Trust.   more »

The hedge-fund industry may be on track to deliver its best annual returns in years, but many managers still aren't in a position to collect performance fees. Most hedge-fund fortunes were earned through the collection of performance fees, typically 20% of any profit. The fee structure gives managers an incentive to outperform and provides some protection for their investors. But in the third quarter, roughly two-thirds of funds globally still hadn't recovered from the steep declines of 2008, estimates Chicago data tracker Hedge Fund Research Inc., or HFR. About a quarter of funds were more than 20% below their previous high point, or high-water mark, and thus couldn't charge performance fees for this year's gains. The industry "is recovering, but not yet recovered," said Kenneth Heinz, HFR's president. For many managers, 2009 will be the second year in a row that they won't be pocketing performance fees.   more »