# Confluence `kaal:entity:confluence` **Status.** derived This node is assembled mechanically from the 13 claims that carry the concept tag `confluence`. It is a roster of what the corpus says under this term. It is **not** an adjudicated definition: no single statement here has been ruled canonical, and no first-appearance call has been made. Read the claims and judge for yourself. ## Every claim under this term 13 claims across 2 works, 2016 to 2017. **2016** - [2715083-001](https://wulfkaal.github.io/claims/2715083-001) [definitional/argued] -- Confluence between mutual and hedge funds runs in two directions at once: mutual funds are converging on hedge funds along the dimension of investment strategy, while hedge funds are converging on mutual funds along the dimension of regulation. > Mutual funds are becoming more like hedge funds as a matter of investment strategy while hedge funds are becoming more like mutual funds as a matter of the regulatory framework. Kaal, Confluence of Mutual and Private Funds (2016). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2715083 - [2715083-002](https://wulfkaal.github.io/claims/2715083-002) [mechanism/argued] -- Regulatory convergence is not driven only by tightened post crisis rules: the liberalization of advertising restrictions after the Dodd-Frank Act also pushes hedge funds toward mutual fund form, so deregulation and reregulation work in the same convergent direction. > This is not just a result of more stringent regulations enacted via the Dodd-Frank Act in the aftermath of the financial crisis; the liberalization of the advertising restrictions post Dodd-Frank Act also makes hedge funds more like mutual funds. Kaal, Confluence of Mutual and Private Funds (2016). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2715083 - [2715083-022](https://wulfkaal.github.io/claims/2715083-022) [mechanism/argued] -- The cost savings of the multimanager series trust model are a confluence mechanism: they let a growing number of smaller hedge fund advisers reach retail investors by launching a mutual fund. > The cost savings associated with the multimanager series trust governance model allow the increasing number of smaller hedge fund investment advisers to attract retail investors by setting up a mutual fund. Kaal, Confluence of Mutual and Private Funds (2016). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2715083 - [2715083-027](https://wulfkaal.github.io/claims/2715083-027) [definitional/asserted] -- The confluence trends identified are correlational, not causal: the author expressly disclaims any claim of cause and effect and presents the peripheral effects as long term possibilities warranting monitoring. > The emerging process of confluence of mutual and hedge funds can have unexpected peripheral effects that may themselves reinforce confluence of the two asset classes. I do not claim cause and effect in this context. Kaal, Confluence of Mutual and Private Funds (2016). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2715083 - [2715083-030](https://wulfkaal.github.io/claims/2715083-030) [mechanism/argued] -- Once a hedge fund adviser is already required to register with the SEC, the marginal regulatory burden of also running a mutual fund or retail alternative fund is small, which gives registered advisers an incentive to enter the registered fund space. > Hedge fund advisers who are required to register with the SEC have incentives to also manage mutual funds or set up retail alternative funds because the regulatory burden is minimally higher in comparison with preregistration legal requirements. Kaal, Confluence of Mutual and Private Funds (2016). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2715083 - [2715083-036](https://wulfkaal.github.io/claims/2715083-036) [mechanism/argued] -- Confluence of mutual and hedge funds contributes to the gradual erosion of the public/private distinction that structures federal securities regulation. > Mutual and hedge fund confluence contributes to the gradual erosion of the public/private distinction in federal securities regulation. Kaal, Confluence of Mutual and Private Funds (2016). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2715083 - [2715083-037](https://wulfkaal.github.io/claims/2715083-037) [empirical/argued] -- The evidence assembled here suggests the traditional public/private distinction between mutual and hedge funds is eroding faster than previously anticipated. > The evidence listed herein suggests that the traditional public/private distinctions between mutual and hedge funds is eroding at a higher than previously anticipated rate. Kaal, Confluence of Mutual and Private Funds (2016). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2715083 **2017** - [2998097-033](https://wulfkaal.github.io/claims/2998097-033) [mechanism/argued] -- Confluence runs in both directions: mutual funds are becoming more like hedge funds as a matter of investment strategy, while hedge funds are becoming more like mutual funds as a matter of regulatory framework. > Several factors suggest that mutual funds are becoming more like hedge funds as a matter of investment strategy, while hedge funds are becoming more like mutual funds as a matter of the regulatory framework.169 The factors that perhaps best illustrate the Wulf A. Kaal, Private Investment Fund Regulation - Theory and Empirical Evidence from 1998 to 2016 (2017). SSRN: https://ssrn.com/abstract=2998097 - [2998097-034](https://wulfkaal.github.io/claims/2998097-034) [definitional/argued] -- Unconstrained mutual funds carry private fund style investment strategies inside the regulatory framework of a traditional mutual fund, and they are widely offered to retail investors who would otherwise be excluded from private fund investments. > UMFs are subject to the same regulatory framework as traditional mutual funds, and they are widely offered and available to retail investors who would otherwise be excluded from investments in private investment funds. Wulf A. Kaal, Private Investment Fund Regulation - Theory and Empirical Evidence from 1998 to 2016 (2017). SSRN: https://ssrn.com/abstract=2998097 - [2998097-035](https://wulfkaal.github.io/claims/2998097-035) [mechanism/argued] -- Merging the regulatory requirements applicable to mutual funds with the formerly distinct rules applicable to private investment funds creates incentives for private investment managers to set up retail alternative funds. > Merging the regulatory requirements applicable to mutual funds with the formerly more distinct rules applicable to private investment funds creates incentives for private investment managers to set up retail alternative funds.188 A higher supply of retail alternative funds, in Wulf A. Kaal, Private Investment Fund Regulation - Theory and Empirical Evidence from 1998 to 2016 (2017). SSRN: https://ssrn.com/abstract=2998097 - [2998097-036](https://wulfkaal.github.io/claims/2998097-036) [mechanism/argued] -- Hedge fund advisers already required to register with the SEC have an incentive to also manage mutual funds or set up retail alternative funds, because the incremental regulatory burden of doing so is only minimally higher than their post registration requirements. > Hedge fund advisers who are required to register with the SEC have incentives to also manage mutual funds or set up retail alternative funds because the regulatory burden is minimally higher in comparison with preregistration legal requirements.191 Some registered hedge fund advisers may choose Wulf A. Kaal, Private Investment Fund Regulation - Theory and Empirical Evidence from 1998 to 2016 (2017). SSRN: https://ssrn.com/abstract=2998097 - [2998097-037](https://wulfkaal.github.io/claims/2998097-037) [mechanism/argued] -- The confluence of mutual and private investment funds contributes to the gradual erosion of the public/private distinction in federal securities regulation. > Mutual and private investment fund confluence contributes to the gradual erosion of the public/private distinction in federal securities regulation. Beyond the retail investor- Wulf A. Kaal, Private Investment Fund Regulation - Theory and Empirical Evidence from 1998 to 2016 (2017). SSRN: https://ssrn.com/abstract=2998097 - [2998097-038](https://wulfkaal.github.io/claims/2998097-038) [failure/argued] *(failure mode)* -- The proliferation of unconstrained mutual funds calls into question the effectiveness of retail investor protections under the Investment Companies Act of 1940, because shares in funds that carry private fund strategies and risks may be bought by retail investors with limited or no investment experience. > However, unlike private funds, which are generally limited to investors who satisfy particular investment sophistication and net worth requirements, shares of UMFs may be purchased by retail investors, including those with quite limited or even no investment experience. Wulf A. Kaal, Private Investment Fund Regulation - Theory and Empirical Evidence from 1998 to 2016 (2017). SSRN: https://ssrn.com/abstract=2998097 ## Verify Every claim above resolves to a record carrying a verbatim source quote, the sha256 of the source PDF, and a preformatted citation. Nothing here asks to be taken on trust. curl -s https://wulfkaal.github.io/entities/confluence.md | sha256sum **Canonical form.** This markdown file is the canonical hashed representation of this entity node. Its sha256 is the content hash.