The number of managers who have moved from hedge fund to mutual
fund management since the financial crisis is raising concern
among regulators about risk management and disclosures.
wants it left out of financial reports
They are making the switch as a result of the growing
popularity of liquid alternative funds (liquid alts).
Liquid alts are mutual funds, registered with the Securities
and Exchange Commission (SEC) under the 1940 Investment Company
Act (40 Act). Unlike traditional mutual funds, liquid alts use
hedge fund-like strategies. The mix of the hedge fund approach
and 40 Act registration has made liquid alts particularly
popular, as they outperform other mutual funds and offer fund
managers a larger pool of potential investors.
But their popularity has sparked concern among regulators
that managers and investors may not fully understand the risks
"The SEC is...