Investors who are interested in a hedge fund are typically required to fork over large fees and large initial investments. Alternatively, with exchange traded funds, the average retail investor can easily and cheaply follow hedge fund strategies.

Through so-called hedge fund clones, investors can follow some prominent money managers’ most popular picks. For instance, the Direxion iBillionaire Index ETF (NYSEArca: IBLN) tracks 30 U.S. stocks in which a pool of up to 10 billionaires have invested the most assets and holdings are equally weighted. IBLN has a 0.65% expense ratio. [ETFs a Better Way to Hedge Fund Investing]

The AlphaClone Alternative Alpha ETF (NYSEArca: ALFA) tracks the performance of US-traded equity securities to which hedge funds and institutional investors have disclosed significant exposure. Positions are selected based on the highest ranking, or so-called Clone Score. ALFA has a 0.95% expense ratio.

Lastly, the Global X Guru Index ETF (NYSEArca: GURU) includes high conviction picks taken from a select pool of hedge fund 13F information, screening for factors like low turnover. GURU has a 0.75% expense ratio. [ETFs for Your Inner Hedge Fund Hero]

The hedge fund ETFs track holdings selected from quarterly hedge fund disclosures. The SEC Form 13F, or Information Required of Institutional Investment Managers Form, is a quarterly filing required of institutional managers with over $100 million in qualifying assets. The filing contains information on the manager’s list of recent investing holdings, which provide the public a glimpse of how the heavy weights are moving around the changing markets.

The hedge fund ETFs provide a cheap way to access some of the largest money managers’ picks. Specifically, ETF investors will not be exposed to the infamous 2-and-20 fee, or 2% management fee and 20% performance fee.

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