Investors Filing Into Alternatives Funds as Fed Gets Out of Bonds

The exact timing may be uncertain, but volatility will return to the market in the foreseeable future, especially now that the Federal Reserve is tapering its bond purchases, said Scott Schweighauser, portfolio manager for the Aurora Horizons Fund. Schweighauser added that the impending return of volatility is a prime reason for the increased demand for alternative, fund-of-funds mutual funds like his own. Finally, Schweighauser said he raised his exposure to event-driven funds due to the rise in M&A, which he calls a byproduct of the low interest rate environment.