While hedge funds have been around for decades, many investors have little understanding of them. But this is likely to change, thanks to an influx of mutual funds and exchange-trade funds (ETFs) that try to mimic hedge funds. It’s a trend that’s likely to continue.

Hedge funds are private partnerships that have lots of flexibility. They can engage in sophisticated strategies, like arbitrage, or use short selling. The focus is to try to achieve absolute returns — that is, to get positive returns in any market environment. Hedge funds are typically restricted to taking money only from institutions and high-net-worth investors.

Looking for more profits, however, Wall Street is expanding the opportunity to all investors. KKR (NYSE:KKR), for example, is launching two mutual funds — which are similar to hedge funds — that focus on debt instruments, such as junk bonds or distressed securities.

So what are some others that could be interesting? Let’s take a look:

Marketfield (MUTF:MFLDX): This fund focuses on a macro strategy. It looks for megatrends across the world, such as in currencies and interest rates. It’s not easy, and even the best investors can stumble. But MFLDX’s Michael Aronstein has been able to cut through the complexities. A key is that he knows how to identify key themes and then put together a portfolio that should benefit. For instance, one of his calls was on the economic slowdown in China.

So far, MFLDX has had a good year, with a gain of over 8%. Actually, the fund has been fairly consistent: The annual average return for the past three years is an impressive 13%.

Diamond Hill Long-Short A (MUTF:DIAMX): This is a long-short fund, which is a fairly common approach for hedge funds. The success of DIAMX has come mostly from its savvy long positions. But the short holdings have provided some downside protection. All in all, DIAMX has been able to produce decent results. In 2012, the return is 4.51%.

AdvisorShares Active Bear ETF (NYSE:HDGE): This ETF is one of the few that has active management. Its portfolio managers include John Del Vecchio and Brad Lamensdorf, who formerly operated a hedge fund. HDGE focuses on short selling. And so far Vecchio and Lamensdorf have demonstrated a knack for spotting good picks. Some include Green Mountain Coffee Roasters (NASDAQ:GMCR) and Groupon (NASDAQ:GRPN).

Yet the fund has been volatile. For the past year, the return was -4%, but it has seen a rally of 8.5% during the past three months.

Merger Fund (MUTF:MERFX): A popular category for hedge funds is merger arbitrage. This is a way to make money on the gaps in valuations of announced mergers. One of the top players is the Merger Fund, which got its start back in 1989. True, the performance has been lackluster in 2012, with a gain of under 2%. But that’s because the merger market has been inactive. However, when things pick up, the Merger Fund should be a nice beneficiary.

Tom Taulli runs the InvestorPlace blog IPOPlaybook, a site dedicated to the hottest news and rumors about initial public offerings. He also is the author of “All About Short Selling” and “All About Commodities.” Follow him on Twitter at @ttaulli. As of this writing, he did not own a position in any of the aforementioned securities.