Alternative mutual funds have proliferated in recent years, providing broad access to investment strategies once available only to high-net-worth investors and institutions. These more-liquid vehicles attempt to provide portfolio benefits similar to those of hedge funds - but in the U.S. must do so within the constraints of federal mutual fund regulations.
This issue of Investment Focus reviews alternative mutual funds and, using U.S. data, provides an in-depth analysis of their historical performance compared to hedge funds. The issue also gives an overview of how the hedge fund and alternative mutual fund universes have evolved, and examines their key differences relating to investor qualifications, liquidity, leverage, fees and tax requirements. The issue concludes with a discussion of the benefits and potential limitations of alternative mutual funds for both individual and institutional investors.
Download the full Investment Focus as a PDF from the link at the bottom of this page.
For a two-page discussion of key points made in the Investment Focus, see Segal Rogerscasey Canada's December 2014 Investment Brief, "Alternative Mutual Funds: A Viable Liquid Substitute for Hedge Funds?"