Even as the SEC decided last month to put alternative mutual funds under the regulatory microscope, the investments are in a growth period as asset managers who offer the products seek to market their advantages to advisors and investors.

The SEC’s broad examination of alternative mutual funds includes large and small players, but many industry experts do not believe increased scrutiny from Washington will affect their momentum going forward. The investments differ from other mutual funds since they have some hedge fund components to them including short selling, trading futures and utilizing derivatives.

Bill Wostoupal, president of Northern Lights Distributors, says his company has worked hard to set up meetings with advisors at industry conferences to educate about alternative mutual funds. The subsidiary of NorthStar arranged for three clients who deal in the space, Grant Park Funds, Horizon Investments and Princeton Funds, to hold breakout sessions at the recently held LPL Focus Conference in San Diego. Wostoupal added that some constructive conversations with advisors are often held outside a booth they set up at conferences like at LPL.

“We try to get fund companies we deal with opportunities to be in a setting to educate,” says Wostoupal. “We want more advisors to understand this product and how it works.”

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