Many of the smaller traders are short term, but I wouldn't call them day traders. The bigger PM's at the fund tend to be position traders who scale in and trade around their positions for months at a time.
Hedge funds trade in many different timeframes. The attempt to label them as only one way or another is misguided.
Wrong. Check your info. Cramer never blew up with his fund. He had a steep drawdown of something like 35% and redemptions coming in left and right in Sept/Oct 1998. Allegedly, his fund recovered by early 1999.
Unfortunately, but not surprisingly, any fund that takes a hit like that also takes a huge hit in their assets under management figure when people run for the hills. So sure, the "fund" may have started to make positive gains, but that doesn't mean the size ever recovered. And for a 2/20 structure that can hurt.