A strength of Arbitrage Fund is its experienced longest-tenured portfolio managers, who have accrued an average 22 years of tenure. This experience should give investors confidence in the group's ability to navigate a variety of conditions. Arbitrage Fund's risk-adjusted performance compares similarly to competitors. Across its open-end and exchange-traded funds, the firm’s average five-year Morningstar Rating is 3.5 stars, which is about standard. Portfolio management turnover at Arbitrage Fund is higher than at peer firms, detracting from the overall assessment of the firm's stewardship. Turnover in the portfolio-management ranks can happen for a number of reasons, including mergers and liquidations, portfolio managers moving into other roles, or portfolio managers leaving the firm. In some cases, such change may not signal a serious or immediate problem at the firm, but can still be disruptive for investors, hinder the effectiveness of a firm’s investment processes, or suggest a weaker investment culture.
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