Things didn’t look good for the Shoreline Trading Group team at the beginning of this year’s Hedge Fund Regatta.

The 3/16th-inch safety cord had snapped, sending Ned Glenn, Merrill Lynch corporate compliance lawyer by day, mastman by evening, into New York Harbor. But the team, sponsored by the prime broker, raced through the adversity to capture the 2008 Hedge Fund Cup.

Cheered on by supporters from a party barge, the field that the Shoreline team sped past was significantly smaller than last year’s, thinned by the ongoing credit crisis and market volatility that has battered Wall Street. This year’s fifth-annual regatta featured 17 teams, sponsored by the likes of the Alternative Investment Group, Caxton Associates, the Connecticut Hedge Fund Association, Highbridge Capital Management, Hudson Bay Capital Management, Moore Capital and Lehman Brothers Asset Management. Credit Suisse, Goldman Sachs and JPMorgan Chase, which sponsored teams last year, were absent this time around.

Each team paid $2,000 for the right to sail against their peers, raising some $50,000 for the New York Harbor Sailing Foundation, which supports a junior sailing program for inner-city children.

“It’s just a great event for a great cause,” Shoreline’s Mike Murray said. “It’s a competitive leisure activity for a competitive industry. When you get to raise a trophy over your head, it’s a good time.”

For their efforts, the Shoreline team took home the prized Cup, crystal apple paperweights from Tiffany & Co., and a $5,000 voucher for private flyer Linear Air. Murray added that the trophy—won by Shoreline in its first year as a sponsor—was being passed around the water cooler like hockey’s Stanley Cup.