NEW YORK — Would you eat at a restaurant where the chefs didn’t eat their own cooking? Would you have joined the Hair Club if the president weren’t also a client? Then why would you invest in a mutual fund where the managers don’t put their own money alongside yours?
That’s what a growing number of managers are asking. They invest their own savings in their funds, which they say makes them more in tune with investors’ interests. Mutual fund managers aren’t required to invest in their own funds, and they can still perform well without doing so. But it’s encouraging for investors to see that managers believe enough in the fund to put their own money on the line, proponents say.