Mutual fund portfolio managers sometimes leave their jobs for the freedom and fees that hedge funds can bring. It can work the other way, however.

John Orrico, a former hedge fund manager, is planning to open a mutual fund that will follow a familiar hedge fund strategy - merger arbitrage. The Arbitrage Fund plans to invest at least 65 percent of its assets in the securities of companies that are involved in proposed mergers, according to a registration statement filed with the SEC Feb. 15.

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