2. Yes, it's possible to be too big. But Paulson might want to watch out. One hedge fund placement agent tells StreetWise that investors—particularly those coveted institutional investors—are pushing back against fund groups that are too big (and perhaps too visible.) "Investors don't want tiny managers, or new players," this individual notes. Gone are the days when Wall Street firms and members of the buy-side were willing to back complete newbies with unrestrained enthusiasm.

On the other hand, potential investors display a strong and growing preference for relatively low-profile investment teams with a solid record that are large enough to absorb institutional inflows yet still small enough to be nimble in markets where alpha can be tricky to capture consistently. "Think fund sizes of $1 billion to $3 billion—the kind of fund that is big enough to be substantive, but not institutionalized." A name brand is fine and dandy, but won't offset the perception that a giant hedge fund isn't going to be creative where it counts most—in seeking out alpha.

3. Alpha or beta? Speaking of which, where is that alpha, anyway? Those who keep a keen eye on what hedge funds are up to say that a fair number of them are riding the beta wave, even as they still insist they are capturing alpha. "A lot of them are just long credit and benefiting from that, even though they claim that they are making that return from finding special situations in the debt markets," says one hedge fund market analyst who spends a chunk of his time talking to managers about their strategies. "In general, I think a lot of funds in the credit space, in particular, are long, pure and simple."

And even those who are pessimistic about the credit market's fundamentals, and skeptical about the ability to generate alpha over the long haul, are "having a hard time fighting the technicals." (BlueMountain Capital Management returned funds to investors from a debt fund it raised only about a year ago, noting that it believed the opportunity is now over.) Hedge fund managers may face some fallout over this down the road if their investors believe they've been forking over alpha fees for returns that they could have captured more cheaply in a lower-cost fund that doesn't pretend to do more than nail down the beta, or market-based return. The pressure is on for hedge funds of all stripes to prove that what they're doing is generating real alpha, not just beta plus one or two percentage points.

4. Calm down, Wall Street. The nascent hedge fund revival isn't necessarily great news for Wall Street: Those hedge funds that are growing most rapidly tend to be using fewer of the most lucrative prime brokerage services on which Wall Street earns fees than they once did. "A long-only hedge fund manager focusing on credit is a loss leader for their prime broker," says one insider. "They don't sell short, they use little leverage, they don't keep cash balances on hand—basically, they're not making any money for the guys who sign them up."

Others are ducking away from using leverage, despite the fact that Wall Street is eagerly offering it to hedge fund survivors once more. "We've been burned; we've learned: I'm a bit surprised at some of the terms sales guys are urging on me," says the manager of one medium to large-size New York-based hedge fund. "We keep saying no. I wonder what is going to happen when some of the guys out there who've cured their addiction to leverage find their pushers offering it to them on easy terms again?"

5. The regulatory threat. OK, so Britain's Financial Services Authority determined last fall that that country's top hedge funds didn't pose a "destabilizing threat" despite their use of leverage, and the European Union has so far refrained from pushing through tough new restrictions on the hedge fund universe at least in part out of fear of triggering a trade war with the United States. But that doesn't mean that these freewheeling investment vehicles shouldn't worry about tough new rules on both sides of the Atlantic.

The SEC's Mary Schapiro is eager to bring more scrutiny to their operations and set up new rules for them to live by. Then there is the ever-present threat of new curbs on short-selling, a key weapon in hedge fund arsenals. Those rules could eat into returns for fund groups, even those offshore players that attract funds from individuals or institutions domiciled in the U.S. or Europe.

Get set for a bumpy ride. Yes, hedge funds are reviving, and, yes, many of them are finding new ways to earn returns. But there are some unhappy investors out there who are still "locked up" in hedge funds and paying hefty fees on assets that they really want to retrieve, and others who are worried that the returns they're seeing aren't reliable "alpha."

A sizable number of hedge funds have quietly given way on the fee front, charging a smaller management fee or carry, or offering novel structures, such as a carry fee (or percentage of the fund's profits) that is levied after two or three years, to prove that the returns they are posting aren't just a fleeting phenomenon. Running a successful hedge fund may still be a sure ticket to outsize wealth for a talented trader, but making money hand over fist in the wake of the crisis is going to be tougher for managers, investors, and Wall Street alike.