Regulators take note: New research finds mutual fund managers do better, not worse, when they also manage “side-by-side” hedge funds
|Mar 15th, 2010 | Filed under: Academic Research, Retail Investing, Today's Post | By: Alpha Male||
Popular mythology often tells the tale of a disgruntled mutual fund manager who strikes out on his or her own and starts a (more lucrative) hedge fund business. The existing hedge fund community often retorts that mutual fund managers simply don’t have the training (read “short selling”) experience to manage a hedge fund.
Is this just marketing bravado? Or is it true that mutual fund managers are no good at managing hedge funds.
More importantly for policy makers, does a mutual fund manager do a disservice to their investors by running a hedge fund on the side? After all, wouldn’t the much lauded “alignment of interests” inherent in hedge fund contracts give the manager an incentive to funnel their best trades and ideas to the “2 and 20″ hedge fund? More…
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