OppenheimerFunds Inc.’s move to enter the hedge fund distribution business by agreeing to buy Tremont Advisers Inc. underscores retail mutual fund houses’ need to diversify their products.

Kurt Wolfgruber, director of domestic equity at Oppenheimer, said the $120 billion-asset company is buying the Rye, N.Y., hedge fund manager because financial advisers — its best sales channel — want to offer hedge funds, and funds of funds, to their clients.

Buying a company with a track record makes more sense than developing one internally, Mr. Wolfgruber said. Oppenheimer wants its hedge fund management unit to be independent and thought it would be difficult to instill entrepreneurship in an organization that it built itself, he said.

Tremont president and co-chief executive officer Robert Shulman said the purchase would give his company more access to two investor classes that already make up the core of its business: institutional and high-net-worth.

The deal was announced Tuesday and is expected to close in the fourth quarter.

Paul Fullerton, an analyst at Cerulli Associates in Boston, said Oppenheimer would get needed diversification at a time when growth in the mutual fund industry is slowing. The hedge fund market “is more attractive than the retail fund market, which is maturing,” he said.

Tremont, which administers $8 billion of hedge fund assets ($1.5 billion of that in its proprietary funds), would also have access to another group of potential clients through Oppenheimer’s ultimate parent company, Massachusetts Mutual Life Insurance Co. in Springfield.

“Insurance companies, family offices, and brokerages are our most robust channels,” Mr. Shulman said. Banks account for only a small fraction of Tremont’s total fund sales because most do not have the access to wealthy clients that the other channels have, he said.

Hedge funds products, including hedge funds of funds, are traditionally not mass marketed. Since there is much stronger demand for these products, being part of OppenheimerFunds would enable Tremont’s funds to be marketed on a much wider scale, Mr. Shulman added.

Cliff Asness, the managing principal at Applied Quantitative Research, a hedge fund research group in New York, agreed that alternative investment products have not had wide distribution but said investor demand is starting to change that picture.

Several other mutual fund companies have come to view hedge funds as crucial. Oppenheimer’s deal is the third in the past 12 months. ED&F Man Group of London and the Chicago hedge fund adviser Glenwood Capital Investments merged last September, and Symphony Asset Management merged with the retail fund manager John Nuveen & Co. in June.

Others, such as MFS Investment Management and Strong Capital Management, have built their own hedge funds.

Virginia Reynolds Parker, president of the hedge fund company Parker Global Strategies in Stamford, Conn., said traditional mutual fund and asset management companies will probably keep expanding into hedge funds because they are much more profitable than traditional funds.

Average annual fees in retail mutual fund fees are often higher. According to Strategic Insight, a research firm in New York, the simple average annual fee for a retail equity fund is 1.56% of assets, compared with 1% for hedge funds.

But hedge funds customarily add performance fees on top of yearly advisory fees, Ms. Parker said. These can be as high as 10% of a fund’s annual returns, which can triple the adviser’s earnings in a good year, she said.

Oppenheimer Acquisition Corp., the MassMutual unit of which OppenheimerFunds is a part, is to pay Tremont $145 million, or $19 a share.

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