A type of fund that is registered with the Securities and Exchange Commission (SEC) and is sold to individual investors through investment dealers and in open market transactions. Retail funds are often categorized as mutual funds, and carry lower initial investments and management expense ratios than non-retail funds.

Because retail funds are registered with the SEC, they are restricted in the amount of overall risk they can expose themselves to, such as option trading and short selling. These risks are considered as such due to the nature of their volatility and speculative nature.

If you compare retail funds to non-retail hedge funds, you will notice that non-retail hedge funds typically require larger initial investments and are marketed privately to high net worth clients.