Hedge-Like Mutual Fund


DEFINITION of 'Hedge-Like Mutual Fund'

A mutual fund that adopts an alternative investment strategy, much like a hedge fund. Hedge-like mutual funds aim to increase investor returns by utilizing investment methods typically used by hedge funds, while maintaining the convenience and availability to investors wishing to invest in mutual funds. The key differences between hedge-like mutual funds and hedge funds are that hedge-like funds are regulated by the SEC, and potential investors in hedge-like funds do not need to be considered accredited investors to invest.

BREAKING DOWN 'Hedge-Like Mutual Fund'

Hedge-like mutual funds can use many different alternative strategies to be considered hedge-like. For example, a hedge-like mutual fund may employ a long-short strategy, or a market neutral strategy in order to achieve better than benchmark returns. These funds are not typically able to use excess leverage in their strategies due to their regulatory status under the SEC, whereas hedge funds are not under the same restrictions.

  1. Hedge Fund

    An aggressively managed portfolio of investments that uses leveraged, ...
  2. Long/Short Equity

    An investing strategy of taking long positions in stocks that ...
  3. Equity Market Neutral

    A hedge fund strategy that seeks to exploit differences in stock ...
  4. Fixed-Income Arbitrage

    An investment strategy that attempts to profit from arbitrage ...
  5. Mutual Fund

    An investment vehicle that is made up of a pool of funds collected ...
  6. Hedge

    Making an investment to reduce the risk of adverse price movements ...
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