It's a Great Time To Start a Hedge Fund

Nov. 10 (Bloomberg)—There are tough new regulations on the horizon. There are scandals and arrests. Investors, shaken by the credit crunch, are nervous about taking risks.

Yes, there has never been a better time to polish your CV, shine your shoes, and start a new hedge fund.

The world is perfectly poised for hedge funds to make huge sums of money in the next five years. Asset prices are still way off their highs. The “carry trade” that allows you to borrow cheaply is back. Most of all, there are bubbles popping and fizzing all over the world.

Hedge funds are ready to mint themselves a fortune again. The only question is: When should you get on that bus?

Politicians are menacing the industry with new rules that are prompting many London-based funds to move to Switzerland.

The industry is also beset by scandal. Helmut Kiener, who founded the K1 Group hedge-fund firm, was arrested in Germany last week, and Raj Rajaratnam, the Galleon Group hedge-fund founder, was taken into U.S. custody on insider-trading charges last month.