HWM correction for a year with very high return

Hi everyone, I was just going through the CAIA L-1 chapters on Hedge Funds(I am applying for it in Feb this year). In the HF part, it is mentioned, that the NAV is set to HWM of a HF at the end of each year. My question is that if a fund manager makes remarkable return under extraordinary sets of conditions(making big money due to foreseeing market failure) and if those conditions can't be realistically present every year, is the HWF still set that high for the next year? Or is there a correction/cap on the amount the HWF can be pragmatically set?

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