Hedge fund Carlson Capital names co-CIO

* Carlson Capital hires new co-CIO

* Announces other staff moves

* Says flagship fund up 20.1 percent since January

By Svea Herbst-Bayliss

BOSTON, Sept 8 (Reuters) - Hedge fund firm Carlson Capital, whose flagship portfolio has gained 20 percent this year, has hired a new co-chief investment officer for the firm, the company's president told investors on Tuesday.

The Dallas-based firm, which manages $4.4 billion, hired Jason Karp, a former director of research and portfolio manager of Global Equities at SAC Capital's CR Instrinsic Investors unit, to become co-chief investment officer.

"Jason will focus on our investment process so that I can spend more time investing, working with our portfolio manager and providing overall strategic direction," Clint Carlson, president of the firm wrote on Tuesday.

Unlike many other hedge fund firms whose heavy losses last year forced them to lay off staff, Carlson Capital has been able to hire two dozen new employees in the last year.

"As you know, we have used the recent market dislocation to expand our investment team, adding 24 investment professionals since June, 2008," Carlson wrote, adding that Karp's position is a new one. The firm also hired Steve Head from UBS to be the firm's head of U.S. client development.

Carlson also said that Roy Trice, the firm's chief operating officer, is retiring and that other senior members of the firm are taking over these responsibilities.

Hedge funds suffered their worst-ever losses in 2008 prompting many investors to pull their money out and forcing many hedge fund managers to reduce staff.

This year, however, many hedge funds are doing much better as hopes that the global downturn will soon end take hold. In the first eight months, the average fund returned 17 percent, putting the $1.4 trillion hedge fund industry on track to deliver its best returns in 10 years, industry analysts said on Tuesday.

Carlson's 12-year old flagship Double Black Diamond fund, which invests $2.9 billion, gained 2.6 percent in August and is up 20.1 percent in the first eight months of the year, Carlson told investors.

(Reporting by Svea Herbst-Bayliss; Editing Bernard Orr)