What mutual fund investors don't know could hurt them, especially if it's that the manager running their money also operates a hedge fund. Some in the industry believe it's time shareholders be made aware of these potential conflicts of interest.

While side-by-side management of mutual and hedge funds can offer investors in both various economies of scalebetter leveraged research and provide firms a way to retain top-notch talentit can also mean favoritism, unequal trading costs, different trading priorities and disproportionate allocations of securities, even among funds with nearly identical objectives and investment philosophies.

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