Institutional investors want consistency more than they want returns. Career risk is a bigger concern than your retirement balance.
In turn, hedge fund traders are paid for returns, but fired for volatility. Firms like Point72 literally have a "down and out" clause in their contract: if you have a certain percent drawdown you will be fired. Internally, hedge funds backtest against measures such as IR (information ratio) and not against returns. IR penalizes for volatility and rewards consistency.