A mutual fund that adopts an alternative investment strategy, much like a hedge fund. Hedge-like mutual funds aim to increase investor returns by utilizing investment methods typically used by hedge funds, while maintaining the convenience and availability to investors wishing to invest in mutual funds. The key differences between hedge-like mutual funds and hedge funds are that hedge-like funds are regulated by the SEC, and potential investors in hedge-like funds do not need to be considered accredited investors to invest.

Hedge-like mutual funds can use many different alternative strategies to be considered hedge-like. For example, a hedge-like mutual fund may employ a long-short strategy, or a market neutral strategy in order to achieve better than benchmark returns. These funds are not typically able to use excess leverage in their strategies due to their regulatory status under the SEC, whereas hedge funds are not under the same restrictions.