ARBITRAGE FUNDS

0001193125-12-425864.txt : 20121017 0001193125-12-425864.hdr.sgml : 20121017 20121017151604 ACCESSION NUMBER: 0001193125-12-425864 CONFORMED SUBMISSION TYPE: 485BPOS PUBLIC DOCUMENT COUNT: 7 FILED AS OF DATE: 20121017 DATE AS OF CHANGE: 20121017 EFFECTIVENESS DATE: 20121017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ARBITRAGE FUNDS CENTRAL INDEX KEY: 0001105076 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: 1933 Act SEC FILE NUMBER: 333-30470 FILM NUMBER: 121148289 BUSINESS ADDRESS: STREET 1: C/O ALPS FUND SERVICES, INC. STREET 2: 1290 BROADWAY, SUITE 1100 CITY: DENVER STATE: CO ZIP: 80203 BUSINESS PHONE: 303-623-2577 MAIL ADDRESS: STREET 1: C/O ALPS FUND SERVICES, INC. STREET 2: 1290 BROADWAY, SUITE 1100 CITY: DENVER STATE: CO ZIP: 80203 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ARBITRAGE FUNDS CENTRAL INDEX KEY: 0001105076 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: 1940 Act SEC FILE NUMBER: 811-09815 FILM NUMBER: 121148290 BUSINESS ADDRESS: STREET 1: C/O ALPS FUND SERVICES, INC. STREET 2: 1290 BROADWAY, SUITE 1100 CITY: DENVER STATE: CO ZIP: 80203 BUSINESS PHONE: 303-623-2577 MAIL ADDRESS: STREET 1: C/O ALPS FUND SERVICES, INC. STREET 2: 1290 BROADWAY, SUITE 1100 CITY: DENVER STATE: CO ZIP: 80203

0001105076 S000006440 THE ARBITRAGE FUND

C000017637 Class R ARBFX

C000017638 Class I ARBNX

C000115401 Class C ARBCX

0001105076 S000030113 THE ARBITRAGE EVENT-DRIVEN FUND

C000092484 Class R AEDFX

C000092485 Class I AEDNX

C000115402 Class C AEFCX

0001105076 S000039281 THE ARBITRAGE CREDIT OPPORTUNITIES FUND

C000120977 Class R ARCFX

C000120978 Class I ACFIX

C000120979 Class C ARCCX

485BPOS 1 d380869d485bpos.htm ARBITRAGE FUNDS ARBITRAGE FUNDS

As filed with the Securities and Exchange Commission on October 17, 2012

1933 Act Registration No. 333-30470

1940 Act Registration No. 811-09815

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-1A


		REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933		x

		Pre-Effective Amendment No.		¨
		Post-Effective Amendment No. 22		x

		and/or

		REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940		x

		Amendment No. 25		x

(Check appropriate box or boxes.)

THE ARBITRAGE FUNDS

(Exact name of Registrant as Specified in Charter)

41 Madison Avenue

42^nd Floor

New York, New York 10010

(Address of principal executive offices) (Zip Code)

Registrant’s Telephone Number, including Area Code: (212) 259-2655

John S. Orrico

Water Island Capital, LLC

41 Madison Avenue, 42^nd Floor

New York, NY 10010

(Name and Address of Agent of Service)

Copy to:

Peter D. Fetzer

Foley & Lardner LLP

777 East Wisconsin Avenue

Milwaukee, WI 53202

It is proposed that this filing will become effective (check appropriate box):

þ	immediately upon filing pursuant to paragraph (b)

¨	on (date) pursuant to paragraph (b)

¨	60 days after filing pursuant to paragraph (a)(1)

¨	75 days after filing pursuant to paragraph (a)(2)

¨	on (date) pursuant to paragraph (a)(2)

If appropriate, check the following box:

¨	This post-effective amendment designates a new effective date for a previously filed post-effective amendment.

Signatures

Pursuant to the requirements of the Securities Act of 1933, as amended (the “Securities Act”), and the Investment Company Act of 1940, as amended, the Registrant certifies that it meets all the requirements for effectiveness of this Post-Effective Amendment No. 22 of its Registration Statement pursuant to Rule 485(b) under the Securities Act and has duly caused this Post-Effective Amendment to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York, and State of New York, on October 17, 2012.

THE ARBITRAGE FUNDS

By: /s/ John S. Orrico

John S. Orrico

President

Pursuant to the requirements of the Securities Act, this Registration Statement has been signed below by the following persons in the capacities and on the dates indicated.


Signature	Title	Date

/s/ John S. Orrico	President, Treasurer and Trustee	October 17, 2012
John S. Orrico

/s/ Kim Storms	Chief Financial Officer	October 17, 2012
Kim Storms

/s/ Jay N. Goldberg *	Trustee	October 17, 2012
Jay N. Goldberg

/s/ John Alvarado *	Trustee	October 17, 2012
John Alvarado

/s/ Burtt R. Ehrlich *	Trustee	October 17, 2012
Burtt R. Ehrlich


		*By:		/s/ John S. Orrico
				John S. Orrico
				Attorney-in-fact

EXHIBIT INDEX


Index No.		Description of Exhibit

EX-101.INS		XBRL Instance Document

EX-101.SCH		XBRL Taxonomy Extension Schema Document

EX-101.CAL		XBRL Taxonomy Extension Calculation Linkbase

EX-101.DEF		XBRL Taxonomy Extension Definition Linkbase

EX-101.LAB		XBRL Taxonomy Extension Labels Linkbase

EX-101.PRE		XBRL Taxonomy Extension Presentation Linkbase

EX-101.INS 2 af2-20120928.xml XBRL INSTANCE DOCUMENT 0001105076 af2:S000006440Member af2:C000115401Member 2011-10-02 2012-10-01 0001105076 af2:S000006440Member af2:C000017638Member 2011-10-02 2012-10-01 0001105076 af2:S000006440Member af2:C000017637Member 2011-10-02 2012-10-01 0001105076 af2:S000030113Member af2:C000092484Member 2011-10-02 2012-10-01 0001105076 af2:S000030113Member af2:C000092485Member 2011-10-02 2012-10-01 0001105076 af2:S000030113Member af2:C000115402Member 2011-10-02 2012-10-01 0001105076 af2:S000006440Member 2011-10-02 2012-10-01 0001105076 af2:S000039281Member 2011-10-02 2012-10-01 0001105076 af2:S000030113Member 2011-10-02 2012-10-01 0001105076 af2:S000039281Member af2:C000120977Member 2011-10-02 2012-10-01 0001105076 af2:S000039281Member af2:C000120978Member 2011-10-02 2012-10-01 0001105076 af2:S000039281Member af2:C000120979Member 2011-10-02 2012-10-01 0001105076 2011-10-02 2012-10-01 0001105076 af2:S000030113Member rr:AfterTaxesOnDistributionsMember af2:C000092484Member 2011-10-02 2012-10-01 0001105076 af2:S000030113Member rr:AfterTaxesOnDistributionsAndSalesMember af2:C000092484Member 2011-10-02 2012-10-01 0001105076 af2:S000006440Member rr:AfterTaxesOnDistributionsAndSalesMember af2:C000017637Member 2011-10-02 2012-10-01 0001105076 af2:S000006440Member rr:AfterTaxesOnDistributionsMember af2:C000017637Member 2011-10-02 2012-10-01 0001105076 af2:S000006440Member af2:StandardAndPoorsFiveHundredIndexMember 2011-10-02 2012-10-01 0001105076 af2:S000030113Member af2:BarclaysCapitalUSAggregateBondIndexMember 2011-10-02 2012-10-01 pure iso4217:USD 1576 1077 1204 1275 1149 1644 Example <div style="display:none">~ http://www.thearbfund.com/role/ScheduleShareholderFeesTHEARBITRAGECREDITOPPORTUNITIESFUND column period compact * ~</div> Example Example 2012-06-30 2012-06-30 <div style="display:none">~ http://www.thearbfund.com/role/ScheduleShareholderFeesTHEARBITRAGEFUND column period compact * ~</div> <div style="display:none">~ http://www.thearbfund.com/role/ScheduleShareholderFeesTHEARBITRAGEEVENTDRIVENFUND column period compact * ~</div> THE ARBITRAGE FUND SUMMARY SECTION The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the Fund's performance. During the most recent fiscal year, the Fund's portfolio turnover rate was 563% of the average value of its portfolio. THE ARBITRAGE CREDIT OPPORTUNITIES FUND SUMMARY SECTION The Fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the Fund’s performance. 1077 1576 1204 Other Expenses are based on estimated amounts for the current fiscal year. THE ARBITRAGE EVENT-DRIVEN FUND SUMMARY SECTION 0.1518 The Fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the Fund’s performance. During its most recent fiscal year, the Fund’s portfolio turnover rate was 490% of the average value of its portfolio. 1275 1149 1644 -0.0008 0.0062 Shareholder Fees (fees paid directly from your investment) Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) 0 0 0 0 0 0 178 153 353 <div style="display:none">~ http://www.thearbfund.com/role/ScheduleAnnualFundOperatingExpensesTHEARBITRAGECREDITOPPORTUNITIESFUND column period compact * ~</div> Shareholder Fees (fees paid directly from your investment) Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) 228 203 403 Shareholder Fees (fees paid directly from your investment) Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) 0 0 0 221 196 396 Other Expenses for Class C shares are based on Class R expenses because the Class C shares have not been offered for a full year. The bar chart and performance table shown below depict the performance of the Fund's Class R shares for the periods indicated and show how the Fund's average annual total returns compare with those of a broad measure of market performance. 2010-10-01 Other Expenses for Class C shares are based on Class R expenses because the Class C shares have not been offered for a full year. The bar chart and performance table shown below depict the performance of the Fund’s Class R shares for the periods indicated and show how the Fund’s average annual total returns compare with those of a broad measure of market performance. <div style="display:none">~ http://www.thearbfund.com/role/ScheduleAnnualFundOperatingExpensesTHEARBITRAGEFUND column period compact * ~</div> <div style="display:none">~ http://www.thearbfund.com/role/ScheduleAnnualFundOperatingExpensesTHEARBITRAGEEVENTDRIVENFUND column period compact * ~</div> 485BPOS ARBITRAGE FUNDS 2012-09-28 Principal Investment Strategies Average Annual Total Returns for Periods Ended December 31, 2011 0 0 0.01 This table describes the fees and expenses that you may pay if you buy and hold shares of the Fund. This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. It assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Fund's operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions, your costs would be: During the period shown in the bar chart, the highest return for a quarter was 6.21% during the quarter ended March 31, 2002 and the lowest return for a quarter was -3.65% during the quarter ended September 30, 2004. The year-to-date return of the Fund's Class R shares through June 30, 2012 is -0.08%. While the Class I shares and the Class C shares would have substantially similar annual returns to the Class R shares, because the shares are invested in the same portfolio of securities, the performance of Class I shares and Class C shares will differ from that shown above to the extent that the Classes do not have the same expenses or inception dates. The table below shows how the Fund's average annual total returns for Class R shares and Class I shares compare with those of the Standard & Poor's 500 Index. The table also presents the impact of taxes on the returns of the Fund's Class R shares. After tax returns are shown for Class R shares only and after-tax returns for Class I and Class C shares will vary. After tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after tax returns depend on an investor's tax situation and may differ from those shown, and after tax returns shown are not relevant to investors who hold their Fund shares through tax deferred arrangements, such as 401(k) plans or individual retirement accounts. Return after taxes on distributions measures the effect of taxable distributions, but assumes the underlying shares are held for the entire period. Return after taxes on distributions and sale of Fund shares shows the effect of both taxable distributions and any taxable gain or loss that would be realized if the underlying shares were purchased at the beginning and sold at the end of the period (for purposes of the calculation, it is assumed that income dividends and capital gain distributions are reinvested at net asset value and that the entire account is redeemed at the end of the period, including reinvested amounts). The Fund's return after taxes on distributions and sale of Fund shares may be higher than its returns before taxes or its returns after taxes on distributions because it may include a tax benefit resulting from the capital losses that would have been incurred. -0.0006 -0.0006 -0.0006 0 0 0.01 178 153 253 This table describes the fees and expenses that you may pay if you buy and hold shares of the Fund. This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. It assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Fund’s expenses are equal to the Total Annual Fund Operating Expenses After Fee Waiver for all three years. Although your actual costs may be higher or lower, based on these assumptions, your costs would be: Principal Investment Strategies 228 203 303 2324 2581 3313 0.0927 This table describes the fees and expenses that you may pay if you buy and hold shares of the Fund. This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. It assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Fund’s expenses are equal to the Total Annual Fund Operating Expenses After Fee Waiver for the first three years and equal to Total Fund Operating Expenses for the remaining years. Although your actual costs may be higher or lower, based on these assumptions, your costs would be: Principal Investment Strategies Average Annual Total Returns for Periods Ended December 31, 2011 The table below shows how the Fund’s average annual total returns for Class R shares and Class I shares compare with those of the Standard & Poor’s 500 Index. The table also presents the impact of taxes on the returns of the Fund’s Class R shares. After tax returns are shown for Class R shares only and after-tax returns for Class I and Class C shares will vary. After tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after tax returns depend on an investor’s tax situation and may differ from those shown, and after tax returns shown are not relevant to investors who hold their Fund shares through tax deferred arrangements, such as 401(k) plans or individual retirement accounts. Return after taxes on distributions measures the effect of taxable distributions, but assumes the underlying shares are held for the entire period. Return after taxes on distributions and sale of Fund shares shows the effect of both taxable distributions and any taxable gain or loss that would be realized if the underlying shares were purchased at the beginning and sold at the end of the period (for purposes of the calculation, it is assumed that income dividends and capital gain distributions are reinvested at net asset value and that the entire account is redeemed at the end of the period, including reinvested amounts). The Fund’s return after taxes on distributions and sale of Fund shares may be higher than its returns before taxes or its returns after taxes on distributions because it may include a tax benefit resulting from the capital losses that would have been incurred. During the period shown in the bar chart, the highest return for a quarter was 5.81% during the quarter ended December 31, 2011 and the lowest return for a quarter was -4.29% during the quarter ended September 30, 2011. The year-to-date return of the Fund’s Class R shares through June 30, 2012 is 0.62%. While the Class I shares and the Class C shares would have substantially similar annual returns to the Class R shares, because the shares are invested in the same portfolio of securities, the performance of Class I shares and Class C shares will differ from that shown above to the extent that the Classes do not have the same expenses or inception dates. 0 0 0.01 -0.0049 -0.0049 -0.0049 221 196 296 2883 2633 3593 The Fund's return after taxes on distributions and sale of Fund shares may be higher than its returns before taxes or its returns after taxes on distributions because it may include a tax benefit resulting from the capital losses that would have been incurred. 2010-10-01 2010-10-01 2010-10-01 2003-10-17 2000-09-18 2000-09-18 2000-09-18 The Fund’s return after taxes on distributions and sale of Fund shares may be higher than its returns before taxes or its returns after taxes on distributions because it may include a tax benefit resulting from the capital losses that would have been incurred. <div style="display:none">~ http://www.thearbfund.com/role/ScheduleAnnualTotalReturnsTHEARBITRAGEFUNDBarChart column period compact * ~</div> This contingent deferred sales charge applies to Class C shares sold within 12 months of purchase. This contingent deferred sales charge applies to Class C shares sold within 12 months of purchase. <div style="display:none">~ http://www.thearbfund.com/role/ScheduleAnnualTotalReturnsTHEARBITRAGEEVENT-DRIVENFUNDBarChart column period compact * ~</div> This contingent deferred sales charge applies to Class C shares sold within 12 months of purchase. 2000-09-18 0001105076 2012-10-01 false 2012-05-31 Investment Objective Fund Fees and Expenses <center>Year-by-Year Total Returns through December 31, 2011 Class R Shares </center> Portfolio Turnover 0 0 0 In attempting to achieve its investment objective, the Fund plans to invest at least 80% of its net assets in equity securities of companies (both U.S. and foreign) that are involved in publicly announced mergers, takeovers, tender offers, leveraged buyouts, spin-offs, liquidations and other corporate reorganizations. Equity securities include common and preferred stock. Merger arbitrage is a highly specialized investment approach designed to profit from the successful completion of mergers, takeovers, tender offers, leveraged buyouts, spin-offs, liquidations and other corporate reorganizations. The Fund's investment adviser uses investment strategies designed to minimize market exposure, including short selling and purchasing and selling options. The most common merger arbitrage activity, and the approach the Fund generally uses, involves purchasing the shares of an announced acquisition target company at a discount to their expected value upon completion of the acquisition. The investment adviser may engage in selling securities short when the terms of a proposed acquisition call for the exchange of common stock and/or other securities. In such a case, the common stock of the company to be acquired may be purchased and, at approximately the same time, an equivalent amount of the acquiring company's common stock and/or other securities may be sold short. The purpose of the short sale is to protect against a decline in the market value of the acquiring company's securities prior to the acquisition's completion. The Fund may enter into equity swap agreements for the purpose of attempting to obtain a desired return on, or exposure to, certain equity securities or equity indices in an expedited manner or at a lower cost to the Fund than if the Fund had invested directly in such securities. The Fund generally engages in active and frequent trading of portfolio securities to achieve its principal investment objective. The Fund will sell or cover a security when the securities of the companies involved in the transaction do not meet the Fund's expected return criteria when gauged by prevailing market prices and the relative risks of the situation. As with all mutual funds, investing in the Fund entails risks that could cause the Fund and you to lose money. The principal risks of investing in the Fund are as follows: Merger Arbitrage Risks: The principal risk associated with the Fund's merger arbitrage investment strategy is that the proposed reorganizations in which the Fund invests may be renegotiated or terminated, in which case the Fund may realize losses. High Portfolio Turnover Risks: The Fund's investment strategies may result in high portfolio turnover rates. This may increase the Fund's brokerage commission costs, which would reduce performance. Rapid portfolio turnover also exposes shareholders to a higher current realization of short-term gains which could cause you to pay higher taxes. Short Sale Risks: The Fund will suffer a loss if it sells a security short and the value of the security rises rather than falls. It is possible that the Fund's long positions will decline in value at the same time that the value of its short positions increase, thereby increasing potential losses to the Fund. Short sales expose the Fund to the risk that it will be required to buy the security sold short (also known as "covering" the short position) at a time when the security has appreciated in value, thus resulting in a loss to the Fund. The Fund's investment performance will also suffer if it is required to close out a short position earlier than it had intended. In addition, the Fund may be subject to expenses related to short sales that are not typically associated with investing in securities directly, such as costs of borrowing. These expenses may negatively impact the performance of the Fund. Short positions introduce more risk to the Fund than long positions (purchases) because the maximum sustainable loss on a security purchased (held long) is limited to the amount paid for the security plus the transaction costs, whereas there is no maximum attainable price of the shorted security. Therefore, in theory, securities sold short have unlimited risk. Put and Call Options Risk: Options transactions involve special risks that may make it difficult or impossible to close a position when the Fund desires. These risks include: possible imperfect correlation between the price movements of the option and the underlying security; the potential lack of a liquid secondary market at any particular time; and possible price fluctuation limits. Foreign Securities Risks: The securities of foreign issuers may be less liquid and more volatile than securities of comparable U.S. issuers. The costs associated with securities transactions are often higher in foreign countries than the U.S. The U.S. dollar value of foreign securities traded in foreign currencies (and any dividends and interest earned) held by the Fund or by mutual funds in which the Fund invests may be affected favorably or unfavorably by changes in foreign currency exchange rates. An increase in the U.S. dollar relative to these other currencies will adversely affect the Fund. Additionally, investments in foreign securities, even those publicly traded in the United States, may involve risks which are in addition to those inherent in U.S. investments. Foreign companies may not be subject to the same regulatory requirements of U.S. companies, and as a consequence, there may be less publicly available information about such companies. Also, foreign companies may not be subject to uniform accounting, auditing, and financial reporting standards and requirements comparable to those applicable to U.S. companies. Foreign governments and foreign economies often are less stable than the U.S. Government and the U.S. economy. Swap Risks: The Fund may enter into derivatives called equity swaps. Risks associated with swap agreements include changes in the returns of the underlying instruments, failure of the counterparties to perform under the contract's terms and the possible lack of liquidity with respect to the swap agreements. Moreover, the Fund bears the risk of loss of the amount expected to be received under a swap agreement in the event of the default or bankruptcy of a swap agreement counterparty. The swaps market is largely unregulated. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund's ability to terminate existing swap agreements or to realize amounts to be received under such agreements. 0.0025 0 0.01 You would pay the following expenses if you did not redeem your shares: 0.0025 0.0025 0.0025 0.0031 0.0031 0.0031 0.0181 0.0156 0.0256 551 474 778 0 0 0 551 474 778 0 0.0025 0.01 0.0079 0.0079 0.0079 0.0015 0.0015 0.0015 0.02 0.03 0.0225 You would pay the following expenses if you did not redeem your shares: Investment Objective Fund Fees and Expenses Portfolio Turnover 703 627 927 August 31, 2015 As with all mutual funds, investing in the Fund entails risks that could cause the Fund and you to lose money. 627 703 927 As with all mutual funds, investing in the Fund entails risks that could cause the Fund and you to lose money. The principal risks of investing in the Fund are as follows: Credit Risk: Credit risk refers to the possibility that the issuer of the security will not be able to make interest or principal payments when due. The Fund may invest in convertible and non-convertible debt securities, including high yield debt securities, also known as “junk bonds”. Investments in junk bonds are subject to greater credit risks than securities with credit ratings above investment grade and have a greater risk of default than investment grade debt securities. Junk bonds are less sensitive to interest rate changes than higher credit quality instruments and generally are more sensitive to adverse economic changes or individual corporate developments. Interest Rate Risks: The market value of debt securities and preferred securities is affected by changes in prevailing interest rates and the credit quality of the issuer. When interest rates fall or the perceived credit quality of the issuer improves, the market value of the respective debt securities and preferred securities usually increases. Conversely, when interest rates rise or the perceived credit quality of the issues declines, the market value of the respective debt securities and preferred securities usually declines. Market Risk: Market risk is the possibility that securities prices will fluctuate over time. This fluctuation includes both increases and decreases in security prices. The Fund is subject to market risk. The value of the Fund’s investments, and the net asset value of the Fund, will fluctuate. Investors could lose money due to this price fluctuation. Merger Arbitrage Risks: The principal risk associated with the Fund’s merger arbitrage investment strategy is that the proposed reorganizations in which the Fund invests may be renegotiated or terminated, in which case the Fund may realize losses. Convertible Security Risks: Convertible securities generally offer lower interest or dividend yields than non-convertible securities of similar quality. Because convertible securities are higher in the firm’s capital structure than equity, convertible securities are generally not as risky as the equity securities of the same issuer. However, convertible securities may gain or lose value due to changes in interest rates and other general economic conditions, industry fundamentals, market sentiment and changes in the issuer’s operating results, financial statements and credit ratings. Small and Medium Sized Company Risks: The Fund invests in small and medium sized companies, which may have more limited liquidity and greater price volatility than larger, more established companies. Small companies may have limited product lines, markets or financial resources and their management may be dependent on a limited number of key individuals. Credit Default Swap Risks: Credit default swaps increase credit risk when the Fund is the seller and increase counterparty risk when the Fund is the buyer. Credit default swaps may be illiquid and may be difficult to trade or value, especially in the event of market disruptions. Credit default swap transactions in which the Fund is the seller may require the Fund to liquidate securities when it may not be advantageous to do so in order to satisfy its obligations or to meet segregation requirements. The swap market could be disrupted or limited as a result of recent legislation, and these changes could adversely affect the Fund. Interest Rate Swap Risks: The risk of interest rate swaps includes changes in market conditions that may affect the value of the contract or the cash flows, and the possible inability of the counterparty to fulfill its obligations under the agreement. Certain interest rate swap arrangements also may involve the risk that they do not fully offset adverse changes in interest rates. Interest rate swaps may in some cases be illiquid and may be difficult to trade or value, especially in the event of market disruptions. Under certain market conditions, the investment performance of the Fund may be less favorable than it would have been if the Fund had not used the swap agreement. Total Return Swap Risks: In a standard “swap” transaction, two parties agree to exchange the returns (or differentials in rates of return) earned or realized on particular predetermined investments or instruments. Certain categories of swap agreements often have terms of greater than seven days and may be considered illiquid. Moreover, the Fund bears the risk of loss of the amount expected to be received under a swap agreement in the event of the default or bankruptcy of a swap agreement counter-party. The swaps market is a relatively new market and is largely unregulated. It is possible that developments in the swaps market, including potential government regulation, could adversely affect the Fund’s ability to terminate existing swap agreements or to realize amounts to be received under such agreements. Futures Risks: The Fund’s use of futures contracts involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. These risks include (i) leverage risk; (ii) correlation or tracking risk and (iii) liquidity risk. Because futures require only a small initial investment in the form of a deposit or margin, they involve a high degree of leverage. Accordingly, the fluctuation of the value of futures in relation to the underlying assets upon which they are based is magnified. Thus, the Fund may experience losses that exceed losses experienced by funds that do not use futures contracts. There may be imperfect correlation, or even no correlation, between price movements of a futures contract and price movements of investments for which futures are used as a substitute, or which futures are intended to hedge. Lack of correlation (or tracking) may be due to factors unrelated to the value of the investments being hedged, such as speculative or other pressures on the markets in which these instruments are traded. Consequently, the effectiveness of futures as a security substitute or as a hedging vehicle will depend, in part, on the degree of correlation between price movements in the futures and price movements in underlying securities. While futures contracts are generally liquid instruments, under certain market conditions they may become illiquid. Futures exchanges may impose daily or intra-day price change limits and/or limit the volume of trading. Additionally, government regulation may further reduce liquidity through similar trading restrictions. As a result, the Fund may be unable to close out its futures contracts at a time which is advantageous. The successful use of futures depends upon a variety of factors, particularly the ability of the Fund to predict movements of the underlying securities markets, which requires different skills than predicting changes in the prices of individual securities. There can be no assurance that any particular futures strategy adopted will succeed. Option Risks: Option transactions in which the Fund may engage involve the specific risks described below: <ul type="square"><li style="margin-left:-10px">the writer of an option may be assigned an exercise at any time during the option period;</li></ul><ul type="square"><li style="margin-left:-10px">disruptions in the markets for underlying instruments could result in losses for options investors;</li></ul><ul type="square"><li style="margin-left:-10px">imperfect or no correlation between the option and the securities being hedged;</li></ul><ul type="square"><li style="margin-left:-10px">the insolvency of a broker could present risks for the broker’s customers; and</li></ul><ul type="square"><li style="margin-left:-10px">market imposed restrictions may prohibit the exercise of certain options.</li></ul>In addition, the option activities of the Fund may affect its portfolio turnover rate and the amount of brokerage commissions paid by the Fund. High Portfolio Turnover Risks: The Fund’s investment strategies may result in high portfolio turnover rates. This may increase the Fund’s brokerage commission costs, which would reduce performance. Rapid portfolio turnover also exposes shareholders to a higher current realization of short-term gains which could cause you to pay higher taxes. Short Sale Risks: The Fund will suffer a loss if it sells a security short and the value of the security rises rather than falls. It is possible that the Fund’s long positions will decline in value at the same time that the value of its short positions increase, thereby increasing potential losses to the Fund. Short sales expose the Fund to the risk that it will be required to buy the security sold short (also known as “covering” the short position) at a time when the security has appreciated in value, thus resulting in a loss to the Fund. The Fund’s investment performance will also suffer if it is required to close out a short position earlier than it had intended. In addition, the Fund may be subject to expenses related to short sales that are not typically associated with investing in securities directly, such as costs of borrowing. These expenses may negatively impact the performance of the Fund. Short positions introduce more risk to the Fund than long positions (purchases) because the maximum sustainable loss on a security purchased (held long) is limited to the amount paid for the security plus the transaction costs, whereas there is no maximum attainable price of the shorted security. Therefore, in theory, securities sold short have unlimited risk. Foreign Securities Risks: The securities of foreign issuers may be less liquid and more volatile than securities of comparable U.S. issuers. The costs associated with securities transactions are often higher in foreign countries than the U.S. The U.S. dollar value of foreign securities traded in foreign currencies (and any dividends and interest earned) held by the Fund or by mutual funds in which the Fund invests may be affected favorably or unfavorably by changes in foreign currency exchange rates. An increase in the U.S. dollar relative to these other currencies will adversely affect the Fund. Additionally, investments in foreign securities, even those publicly traded in the United States, may involve risks which are in addition to those inherent in U.S. investments. Foreign companies may not be subject to the same regulatory requirements of U.S. companies, and as a consequence, there may be less publicly available information about such companies. Also, foreign companies may not be subject to uniform accounting, auditing, and financial reporting standards and requirements comparable to those applicable to U.S. companies. Foreign governments and foreign economies often are less stable than the U.S. Government and the U.S. economy. The Fund invests primarily in a portfolio of debt securities including corporate bonds and debentures (including high yield-bonds commonly known as “junk bonds”), bank loans, convertible and preferred securities that the Fund’s investment adviser believes have debt-like characteristics, credit default swaps and other debt instruments and derivatives that the Fund’s investment adviser believes have debt-like characteristics. The Fund invests in both domestic and foreign debt securities. The principal type of derivatives in which the Fund may invest are credit default swaps, interest rate swaps, total return swaps, futures and options. In order to meet its investment objective the Fund invests primarily in debt securities whose returns the manager believes will be more correlated with the outcome of specific catalysts or events rather than overall market direction. These catalysts and events include reorganizations, restructurings, recapitalizations, debt maturities, refinancings, mergers, acquisitions, regulatory changes and other special situations. The Fund also uses a relative value approach and expresses positive views on specific issuers by taking long positions in cash bonds and/or derivatives and negative views on specific issuers by taking short positions in cash bonds and/or derivatives. The Fund uses fundamental research to identify mispricings or inefficiencies in these situations and assess their potential impact on security prices. The Fund may engage in short-term trading strategies, and may without limitation, engage in short sales and invest in derivatives. The principal short-term trading strategies may at times include convertible arbitrage, merger arbitrage, and capital structure arbitrage, which are discussed below. The Fund will seek to mitigate the risk of volatility (the appreciation or depreciation of the value of a security over a short period of time) and duration (interest rate changes impacting the value of fixed income securities with longer effective maturities more than those with shorter effective maturities) by taking long and short positions, based on individual credit evaluations that are designed to protect against short term fluctuations in the value of securities, as well as by investing in derivatives that are designed to protect against the decline in value of fixed income securities resulting from interest rate changes, including credit default swaps, interest rate swaps, total return swaps, futures and options to hedge the portfolio’s interest rate risk and credit risk. The Fund may purchase or sell short equity securities or derivatives as part of a hedging strategy or hold equity positions or other assets that the Fund receives as part of a reorganization process. The Fund is not limited with respect to its portfolio maturity or duration. The Fund may invest in debt securities without regard to their credit ratings, including securities that are non-investment grade, and in debt securities with a wide variety of terms applicable to principal repayment, interest rates and other features. Terms that vary from security to security include: optional and mandatory prepayment provisions, fixed, variable, semi-variable, and resettable interest rates and conversion options, as well as various combinations of these terms. Convertible Arbitrage: Convertible arbitrage is a specialized strategy that seeks to profit from mispricings between a firm’s convertible securities and its underlying equity. The most common convertible arbitrage approach, and the strategy the Fund generally uses when it believes that the common stock is overvalued in relation to the convertible securities, matches a long position in the debt securities, preferred stocks and other securities convertible into common stock with a short position in the underlying common stock. The Fund seeks to purchase such convertible securities at discounts to their expected future values and sell short shares of the underlying common stock in order to mitigate equity market movements. As stock prices rise and the convertible security becomes more equity sensitive, the Fund will sell short additional common shares in order to maintain the relationship between the convertible and the underlying common stock. As stock prices fall, the Fund will typically buy back a portion of shares which it had sold short. Positions are typically designed to earn income from coupon or dividend payments, and from the short sale of common stock. Merger Arbitrage: Merger arbitrage is a highly specialized investment approach designed to profit from the successful completion of mergers, takeovers, tender offers, leveraged buyouts, spin-offs, liquidations and other corporate reorganizations. The most common merger arbitrage activity, and the approach the Fund generally uses, involves purchasing debt securities of an announced acquisition target company at a discount to their expected value upon completion of the acquisition. The Fund’s investment adviser may engage in selling securities short when the terms of a proposed acquisition call for the exchange of common stock and/or other securities. In such a case, the securities of the company to be acquired may be purchased and, at approximately the same time, an equivalent amount of the acquiring company’s common stock and/or other securities may be sold short. Capital Structure Arbitrage: Capital structure arbitrage seeks to profit from relative pricing discrepancies between related debt and/or equity securities. For example, when the Fund believes that unsecured securities are overvalued in relation to senior secured securities, the Fund may purchase a senior secured security of an issuer and sell short an unsecured security of the same issuer. In this example the trade would be profitable if credit quality spreads widened or if the issuer went bankrupt and the recovery rate for the senior debt was higher. It is expected that, over time, the relative mispricing of the securities will disappear, at which point the position will be liquidated. Investment Objective Fund Fees and Expenses -0.0024 -0.0063 0.045 Portfolio Turnover The Fund invests in equity and debt securities (including high yield-bonds commonly known as “junk bonds”) of companies whose prices we believe are or will be impacted by a corporate event. Specifically, the Fund employs investment strategies designed to capture price movements generated by publicly announced corporate events such as investing in securities of companies involved in mergers, acquisitions, asset sales, restructurings, refinancings, recapitalizations, reorganizations or other special situations (referred to as “event-driven opportunities”). The Fund may invest in both U.S. and non U.S. securities. In order to achieve its investment objective, the Fund may utilize investment strategies such as merger arbitrage, convertible arbitrage and capital structure arbitrage in order to profit from event-driven opportunities. These investment strategies are described more fully below. Merger Arbitrage: Merger arbitrage is a highly specialized investment approach designed to profit from the successful completion of mergers, takeovers, tender offers, leveraged buyouts, spin-offs, liquidations and other corporate reorganizations. The most common merger arbitrage activity, and the approach the Fund generally uses, involves purchasing the shares of an announced acquisition target company at a discount to their expected value upon completion of the acquisition. The Fund’s investment adviser may engage in selling securities short when the terms of a proposed acquisition call for the exchange of common stock and/or other securities. In such a case, the common stock of the company to be acquired may be purchased and, at approximately the same time, an equivalent amount of the acquiring company’s common stock and/or other securities may be sold short. Convertible Arbitrage: Convertible arbitrage is a specialized strategy that seeks to profit from mispricings between a firm’s convertible securities and its underlying equity. The most common convertible arbitrage approach, and the strategy the Fund generally uses when it believes that the common stock is overvalued in relation to the convertible securities, matches a long position in the convertible security with a short position in the underlying common stock. The Fund seeks to purchase convertible securities at discounts to their expected future values and sell short shares of the underlying common stock in order to mitigate equity market movements. As stock prices rise and the convertible security becomes more equity sensitive, the Fund will sell short additional common shares in order to maintain the relationship between the convertible and the underlying common stock. As stock prices fall, the Fund will typically buy back a portion of shares which it had sold short. Positions are typically designed to earn income from coupon or dividend payments, and from the short sale of common stock. Capital Structure Arbitrage: Capital structure arbitrage seeks to profit from relative pricing discrepancies between related debt and/or equity securities. For example, when the Fund believes that unsecured securities are overvalued in relation to senior secured securities, the Fund may purchase a senior secured security of an issuer and sell short an unsecured security of the same issuer. In this example the trade would be profitable if credit quality spreads widened or if the issuer went bankrupt and the recovery rate for the senior debt was higher. Another example might involve the Fund purchasing one class of common stock while selling short a different class of common stock of the same issuer. It is expected that, over time, the relative mispricing of the securities will disappear, at which point the position will be liquidated. The Fund generally engages in active and frequent trading of portfolio securities to achieve its principal investment objective. The Fund will sell or cover a security when the securities of the companies involved in the transaction do not meet the Fund’s expected return criteria when gauged by prevailing market prices and the relative risks of the situation. As with all mutual funds, investing in the Fund entails risks that could cause the Fund and you to lose money. The principal risks of investing in the Fund are as follows: Merger Arbitrage Risks: The principal risk associated with the Fund’s merger arbitrage investment strategy is that the proposed reorganizations in which the Fund invests may be renegotiated or terminated, in which case the Fund may realize losses. Convertible Security Risks: Convertible securities generally offer lower interest or dividend yields than non convertible securities of similar quality. Because convertible securities are higher in the firm’s capital structure than equity, convertible securities are generally not as risky as the equity securities of the same issuer. However, convertible securities may gain or lose value due to changes in interest rates and other general economic conditions, industry fundamentals, market sentiment and changes in the issuer’s operating results, financial statements and credit ratings. Short Sale Risks: The Fund will suffer a loss if it sells a security short and the value of the security rises rather than falls. It is possible that the Fund’s long positions will decline in value at the same time that the value of its short positions increase, thereby increasing potential losses to the Fund. Short sales expose the Fund to the risk that it will be required to buy the security sold short (also known as “covering” the short position) at a time when the security has appreciated in value, thus resulting in a loss to the Fund. The Fund’s investment performance will also suffer if it is required to close out a short position earlier than it had intended. In addition, the Fund may be subject to expenses related to short sales that are not typically associated with investing in securities directly, such as costs of borrowing. These expenses may negatively impact the performance of the Fund. Short positions introduce more risk to the Fund than long positions (purchases) because the maximum sustainable loss on a security purchased (held long) is limited to the amount paid for the security plus the transaction costs, whereas there is no maximum attainable price of the shorted security. Therefore, in theory, securities sold short have unlimited risk. Credit Risks: The Fund may invest in convertible and non convertible debt securities, including high yield fixed income securities, also known as “junk bonds”. Investments in junk bonds are subject to greater credit risks than securities with credit ratings above investment grade and have a greater risk of default than investment grade debt securities. Junk bonds are less sensitive to interest rate changes than higher quality instruments and generally are more sensitive to adverse economic changes or individual corporate developments. Interest Rate Risks: Prices of debt securities and preferred stocks tend to move inversely with changes in interest rates. Typically, a rise in rates will adversely affect prices of these securities and, accordingly, the Fund’s share price. Foreign Securities Risks: The securities of foreign issuers may be less liquid and more volatile than securities of comparable U.S. issuers. The costs associated with securities transactions are often higher in foreign countries than the U.S. The U.S. dollar value of foreign securities traded in foreign currencies (and any dividends and interest earned) held by the Fund or by mutual funds in which the Fund invests may be affected favorably or unfavorably by changes in foreign currency exchange rates. An increase in the U.S. dollar relative to these other currencies will adversely affect the Fund. Additionally, investments in foreign securities, even those publicly traded in the United States, may involve risks which are in addition to those inherent in U.S. investments. Foreign companies may not be subject to the same regulatory requirements of U.S. companies, and as a consequence, there may be less publicly available information about such companies. Also, foreign companies may not be subject to uniform accounting, auditing, and financial reporting standards and requirements comparable to those applicable to U.S. companies. Foreign governments and foreign economies often are less stable than the U.S. Government and the U.S. economy. High Portfolio Turnover Risks: The Fund’s investment strategies may result in high portfolio turnover rates. This may increase the Fund’s brokerage commission costs, which would reduce performance. Rapid portfolio turnover also exposes shareholders to a higher current realization of short-term gains which could cause you to pay higher taxes. 0.045 0.0368 0.0292 0.0474 0.0211 <center>Year-by-Year Total Returns through December 31, 2011 – Class R Shares</center> 0.0292 0.0384 0.0407 0.052 0.0001 0.0399 0.0409 0 0 0 0.0025 0 0.01 0.0049 0.0049 0.0049 0.0068 0.0068 0.0068 0.0267 0.0242 0.0342 682 606 906 682 606 906 As with all mutual funds, investing in the Fund entails risks that could cause the Fund and you to lose money. After tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after tax returns depend on an investor's tax situation and may differ from those shown, and after tax returns shown are not relevant to investors who hold their Fund shares through tax deferred arrangements, such as 401(k) plans or individual retirement accounts. 0.0328 0.0328 0.0109 0.0349 0.0212 0.0784 2002-03-31 0.0621 lowest return 2004-09-30 August 31, 2015 As with all mutual funds, investing in the Fund entails risks that could cause the Fund and you to lose money. You would pay the following expenses if you did not redeem your shares: After tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after tax returns depend on an investor’s tax situation and may differ from those shown, and after tax returns shown are not relevant to investors who hold their Fund shares through tax deferred arrangements, such as 401(k) plans or individual retirement accounts. 2011-12-31 0.0581 lowest return 2011-09-30 <div style="display:none">~ http://www.thearbfund.com/role/ScheduleAverageAnnualTotalReturnsTransposedTHEARBITRAGEFUND column period compact * ~</div> <div style="display:none">~ http://www.thearbfund.com/role/ScheduleAverageAnnualTotalReturnsTransposedTHEARBITRAGEEVENTDRIVENFUND column period compact * ~</div> 2012-10-01 Principal Risks Performance Information -0.02 -0.02 0 0.02 0.02 0 The Fund seeks to achieve capital growth by engaging in merger arbitrage. 0.01 0.01 0.01 The bar chart and performance table shown below depict the performance of the Fund's Class R shares for the periods indicated and show how the Fund's average annual total returns compare with those of a broad measure of market performance. The performance table includes the performance of the Fund's Class I shares before taxes. How the Fund has performed in the past (before and after taxes) is not necessarily an indication of how the Fund will perform in the future. 0.0056 0.0056 0.0056 0.0175 0.015 0.025 0.02 0.02 0 0 -0.02 -0.02 0.0104 0.0104 0.0104 <div style="display:none">~ http://www.thearbfund.com/role/ScheduleExpenseExampleTransposedTHEARBITRAGECREDITOPPORTUNITIESFUND column period compact * ~</div> <div style="display:none">~ http://www.thearbfund.com/role/ScheduleExpenseExampleNoRedemptionTransposedTHEARBITRAGECREDITOPPORTUNITIESFUND column period compact * ~</div> 0.0002 0.0002 0.0002 0.0094 0.0094 0.0094 The fund seeks to provide current income and capital growth. Principal Risks Performance Information Performance information for the Fund will be provided in the prospectus summary and the prospectus once it has annual returns for a full calendar year. Please remember that the Fund's past performance (before and after taxes) is not necessarily an indication of its future performance. It may perform better or worse in the future. 3313 2324 2581 Performance information for the Fund will be provided in the prospectus summary and the prospectus once it has annual returns for a full calendar year. Please remember that the Fund's past performance (before and after taxes) is not necessarily an indication of its future performance. It may perform better or worse in the future. The Fund seeks to achieve capital growth. 0.0057 0.0587 0.0714 0.1005 0.0144 Principal Risks Performance Information The bar chart and performance table shown below depict the performance of the Fund’s Class R shares for the periods indicated and show how the Fund’s average annual total returns compare with those of a broad measure of market performance. The performance table includes the performance of the Fund’s Class I shares before taxes. How the Fund has performed in the past (before and after taxes) is not necessarily an indication of how the Fund will perform in the future. 0.0314 0.0443 0.0303 0.0465 -0.0025 0.0435 0.0548 -0.02 -0.02 0 0.02 0.02 0 0.0125 0.0125 0.0125 0.0117 0.0117 0.0117 0.0218 0.0193 0.0293 2883 2633 3593 5.63 How the Fund has performed in the past (before and after taxes) is not necessarily an indication of how the Fund will perform in the future. After tax returns are shown for Class R shares only and after-tax returns for Class I and Class C shares will vary. 0.0394 0.0186 0.0422 0.0215 0.0006 year-to-date return highest return -0.0365 How the Fund has performed in the past (before and after taxes) is not necessarily an indication of how the Fund will perform in the future. After tax returns are shown for Class R shares only and after-tax returns for Class I and Class C shares will vary. year-to-date return highest return -0.0429 <div style="display:none">~ http://www.thearbfund.com/role/ScheduleExpenseExampleTransposedTHEARBITRAGEFUND column period compact * ~</div> <div style="display:none">~ http://www.thearbfund.com/role/ScheduleExpenseExampleNoRedemptionTransposedTHEARBITRAGEFUND column period compact * ~</div> <div style="display:none">~ http://www.thearbfund.com/role/ScheduleExpenseExampleTransposedTHEARBITRAGEEVENTDRIVENFUND column period compact * ~</div> <div style="display:none">~ http://www.thearbfund.com/role/ScheduleExpenseExampleNoRedemptionTransposedTHEARBITRAGEEVENTDRIVENFUND column period compact * ~</div> 4.9 The following information provides some indication of the risks and variability of investing in the Fund by showing how the Fund's performance has varied over time. The performance shown reflects the performance of the Fund's Class R shares before and after taxes and the Fund's Class I shares before taxes. Performance for the Class C shares of the Fund will be available once they have been offered for one calendar year. The following information provides some indication of the risks and variability of investing in the Fund by showing how the Fund’s performance has varied over time. The performance shown reflects the performance of the Fund’s Class R shares before and after taxes and the Fund’s Class I shares before taxes. Performance for the Class C shares of the Fund will be available once they have been offered for one calendar year. This contingent deferred sales charge applies to Class C shares sold within 12 months of purchase. Other Expenses are based on estimated amounts for the current fiscal year. The Fund is obligated to pay any interest incurred or dividend declared during the period in which the Fund maintains the short position to the lender from which the Fund borrowed the security and the Fund is obligated to record the payment of the accrued interest or dividend as an expense. These expenses are not fees charged to shareholders but are similar to finance charges incurred in borrowing transactions. The Fund may be subject to additional expenses related to short sales (for example, costs of borrowing and margin account maintenance costs). The Fund has entered into an Expense Waiver and Reimbursement Agreement with the Fund's investment adviser so that total annual operating expenses of the Fund, not including the effects of dividends or interest on short positions, acquired fund fees and expenses, taxes, or other extraordinary expenses, do not exceed 1.50% of the Fund's average daily net assets allocable to the Class R shares, 1.25% of the Fund's average daily net assets allocable to the Class I shares and 2.25% of the Fund's average daily net assets allocable to the Class C shares. The agreement remains in effect until August 31, 2015, and thereafter continues until either party terminates it upon not less than five days notice, by sending a written notice to the other party. The adviser may recoup any waived amount from the Fund pursuant to the agreement, if such reimbursement does not cause the Fund to exceed expense limitations and the reimbursement is made within three years after the year in which the expense is waived. Other Expenses for Class C shares are based on Class R expenses because the Class C shares have not been offered for a full year. The inception date for Class R shares is September 18, 2000, and the inception date for Class I shares is October 17, 2003. The "Since Inception" return reflected for the Standard & Poor's 500 Index is based on the inception date for Class R shares. The Fund is obligated to pay any interest incurred or dividend declared during the period in which the Fund maintains the short position to the lender from which the Fund borrowed the security and the Fund is obligated to record the payment of the accrued interest or dividend as an expense. These expenses are not fees charged to shareholders but are similar to finance charges incurred in borrowing transactions. The Fund may be subject to additional expenses related to short sales (for example, costs of borrowing and margin account maintenance costs). The Fund has entered into an Expense Waiver and Reimbursement Agreement with the Fund's investment adviser so that total annual operating expenses of the Fund, not including the effects of dividends or interest on short positions, acquired fund fees and expenses, taxes, or other extraordinary expenses, do not exceed 1.69% of the Fund's average daily net assets allocable to the Class R shares, 1.44% of the Fund's average daily net assets allocable to the Class I shares and 2.44% of the Fund's average daily net assets allocable to the Class C shares. The agreement remains in effect until August 31, 2015, and thereafter continues until either party terminates it upon not less than five days' notice by sending a written notice to the other party. The adviser may recoup any waived amount from the Fund pursuant to the agreement, if such reimbursement does not cause the Fund to exceed existing expense limitations and the reimbursement is made within three years after the year in which the expense was waived. The inception date for Class R shares and Class I shares is October 1, 2010. 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Share Class [Axis] Share Classes C000017637 [Member] Class R Shares Class R,THE ARBITRAGE FUND Member Class R C000017638 [Member] Class I Shares Class I,THE ARBITRAGE FUND Member Class I C000115401 [Member] Class C Shares Class C,THE ARBITRAGE FUND Member Class C Risk/Return [Heading] Objective [Heading] Objective, Primary [Text Block] Objective, Secondary [Text Block] Expense [Heading] Expense Narrative [Text Block] Shareholder Fees Caption [Text] Shareholder Fees [Table] Operating Expenses Caption [Text] Annual Fund Operating Expenses [Table] Expense Footnotes [Text Block] Expenses Range of Exchange Fees [Text Block] Expense Example [Heading] Expense Example by Year [Heading] Expense Example Narrative [Text Block] Expense Example by, Year, Caption [Text] Expense Example, With Redemption [Table] Expense Example, No Redemption Narrative [Text Block] Expense Example, No Redemption, By Year, Caption [Text] Expense Example, No Redemption [Table] Expense Example Footnotes [Text Block] Expense Example Closing [Text Block] Portfolio Turnover [Heading] Portfolio Turnover [Text Block] Strategy [Heading] Strategy Narrative [Text Block] Risk [Heading] Risk Narrative [Text Block] Risk Footnotes [Text Block] Risk Closing [Text Block] Bar Chart and Performance Table [Heading] Bar Chart Narrative [Text Block] Performance Narrative [Text Block] Bar Chart [Heading] Bar Chart [Table] Bar Chart Footnotes [Text Block] Bar Chart Closing [Text Block] Performance Table Heading Performance Table Narrative Performance [Table] Market Index Performance [Table] Performance Table Footnotes Performance Table Closing [Text Block] Shareholder Fees: Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) Maximum Sales Charge Imposed on Purchases (as a percentage of Offering Price) Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price) Maximum Deferred Sales Charge (as a percentage) Sales Charge (Load) Imposed on Reinvested Dividends Maximum Sales Charge on Reinvested Dividends and Distributions (as a percentage) Redemption Fee Redemption Fee (as a percentage of Amount Redeemed) Exchange Fee (as a percentage of amount exchanged within 30 days of purchase) Exchange Fee (as a percentage of Amount Redeemed) Shareholder Fees Column [Text] Maximum Cumulative Sales Charge (as a percentage of Offering Price) Maximum Cumulative Sales Charge (as a percentage) Maximum Deferred Sales Charge (as a percentage of Offering Price) Redemption Fee Redemption Fee Exchange Fee Maximum Account Fee (as a percentage of Assets) Maximum Account Fee Shareholder Fee, Other Operating Expenses: Management Fees Management Fees (as a percentage of Assets) Distribution and/or Service (12b-1) Fees Distribution and Service (12b-1) Fees Other Expenses Other Expenses (as a percentage of Assets): Other Expenses Dividend and Interest Expense on Short Positions Component1 Other Expenses All Remaining Other Expenses Component2 Other Expenses Acquired Fund Fees & Expenses Acquired Fund Fees and Expenses Total Annual Fund Operating Expenses Expenses (as a percentage of Assets) Total Annual Fund Operating Expenses Operating Expenses Column [Text] Distribution or Similar (Non 12b-1) Fees Component3 Other Expenses Fee Waiver or Reimbursement Fee Waiver or Reimbursement Fee Waiver Net Expenses (as a percentage of Assets) Total Annual Fund Operating Expenses After Fee Waiver Total Annual Fund Operating Expenses After Fee Waiver Expense Example: 1 Year Expense Example, with Redemption, 1 Year 3 Years Expense Example, with Redemption, 3 Years 5 Years Expense Example, with Redemption, 5 Years 10 Years Expense Example, with Redemption, 10 Years Expense Example, By Year, Column [Text] Column Expense Example, No Redemption: 1 Year Expense Example, No Redemption, 1 Year 3 Years Expense Example, No Redemption, 3 Years 5 Years Expense Example, No Redemption, 5 Years 10 Years Expense Example, No Redemption, 10 Years Expense Example, No Redemption, By Year, Column [Text] Column Bar Chart Table: Annual Return Caption [Text] Caption Annual Return, Column [Text] Column Annual Return, Inception Date Inception Date Annual Return 1990 Annual Return 1991 Annual Return 1992 Annual Return 1993 Annual Return 1994 Annual Return 1995 Annual Return 1996 Annual Return 1997 Annual Return 1998 Annual Return 1999 Annual Return 2000 Annual Return 2001 Annual Return 2002 2002 Annual Return 2003 2003 Annual Return 2004 2004 Annual Return 2005 2005 Annual Return 2006 2006 Annual Return 2007 2007 Annual Return 2008 2008 Annual Return 2009 2009 Annual Return 2010 2010 Annual Return 2011 2011 Annual Return 2012 Annual Return 2013 Annual Return 2014 Annual Return 2015 Annual Return 2016 Annual Return 2017 Annual Return 2018 Annual Return 2019 Annual Return 2020 Standard And Poors Five Hundred Index. Standard And Poors Five Hundred Index [Member] STANDARD & POOR'S 500 INDEX (reflects no deduction for fees, expenses, or taxes) Average Annual Return: One Year 1 Year Five Years 5 Years Ten Years 10 Years Since Inception Since Inception Inception Date Inception Date Label Risk/Return Detail [Table] Fee Waiver or Reimbursement over Assets, Date of Termination Portfolio Turnover, Rate Expenses Deferred Charges [Text Block] Expense Breakpoint Discounts [Text] Expense Breakpoint, Minimum Investment Required [Amount] Expense Exchange Traded Fund Commissions [Text] Expenses Represent Both Master and Feeder [Text] Expenses Explanation of Nonrecurring Account Fee [Text] Other Expenses, New Fund, Based on Estimates [Text] Acquired Fund Fees and Expenses, Based on Estimates [Text]