We've noted before that the mutual fund and hedge fund industries are converging at the margins. The entire 130/30 movement and the passive hedge fund index movement can be interpreted as the mutual funds industry trying to cash in on the appeal of hedge funds.

AllAboutAlpha.com takes an interesting look at a mutual fund that has adopted some hedge fund properties in interesting ways, while avoiding the term hedge fund. Putnam's new "Equity Spectrum Fund", marketed as a "blend" fund, does not use leverage directly, but it invests in companies that do. It's unclear whether investing in companies that use risk is more or less risky than using leverage directly. You could make a case either way. The fund also is charging a performance fee of sorts. For every one percent that the fund beats the benchmark, the annual fee will go up by 4 basis points. But unlike a hedge fund, the fee can also decline. 

For more:
- here's the article

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