Agree with Mr T on Hedge Funds. Seems like the fund would become a competitor with existing water agencies for access to available water.
Assuming the fund intends to sell to Big-Ag, this situation might result in increased cost per acre foot for all users and increased acreage under cultivation since most water taken from CVP/SWP is on behalf of big-ag. In CA, whether a private company could take an entire river flow for any purpose, might not be possible under current law.
Diversion/storage/sale of water on a large scale is part of CA history. Everything described about diversion of the Humboldt River to canals is already being done in CA (e.g. Trinity River thru dams/diversion of partial flow to Sacramento River, etc.).
Because surface and ground water are regulated separately, the availability of surface water for sale is currently handled by contracts from federal/state water project administrators to water agency/contractors who, in turn sell to growers/municipal/private water districts (actually more complex than this explanation). Formal regulation of groundwater won't occur until 2022, if I recall correctly.
"America is a country which produces citizens who will cross the ocean to fight for democracy but won't cross the street to vote."