<p>Hedge fund investors are supposed to be the smart guys—too rich and sophisticated to need the protections that Wall Street’s regulators try to offer the average investor. But that worldliness doesn’t necessarily keep them from being suckers for a shiny name.</p>
<p>A new study by researchers from the University at Buffalo in New York and Finland’s University of Oulu finds that investors allocate more money to hedge funds with names that have “gravitas.” They estimate that, for funds with similar performance, adding one gravitas-signifying word to a hedge fund name adds about $250,000 to annual flows to that fund.</p>