The four funds note the additional fees under the "Risks" section of their prospectus. In the case of Altegris Managed Futures Strategy, that's on page 16 of the mutual fund's 32-page document.
Chicago-based Grant Park and Denver-based Mount Yale Asset Management LLC, which runs the Princeton Futures fund, don't provide details on the size of the underlying fees.
Representatives of the Altegris, MutualHedge and Grant Park funds said their hands were tied when it came to disclosing fees since SEC policy at the time the funds were created prevented them from listing additional charges in the disclosure tables. A spokesman for the Princeton Futures fund referred questions to JoAnne Strasser, an attorney who has worked for the firm.
Strasser, who specializes in mutual funds for Thompson Hine LLP in Cincinnati, said the SEC has relaxed its policy in recent months and funds are now allowed to list the extra expenses in footnotes. "The SEC has recently loosened up so we may see more disclosure as a result of that," Strasser said in a telephone interview.
Contradictory Rules
Kevin Callahan, a spokesman for the SEC, declined to comment.
Morningstar lists 13 mutual funds in the managed futures category, only four of which are subject to additional fees because they invest in underlying managers. The others either track indexes or employ in-house managers.
The U.S. Commodity Futures Trading Commission is weighing a proposal to regulate funds that use swaps, derivatives and futures to invest in commodity markets.
The rules proposed in January would require mutual-fund operators to register as a commodity pool if they hold more than 5 percent of a portfolio in commodity futures, options or swaps, or market such investments to the public. They would have to clearly disclose all fees, as well as follow other rules that now apply only to private funds.
Opposition From Funds