Umbrella Fund
Umbrella Fund refers to a collective investment scheme that houses multiple sub-funds under a single legal structure. Each sub-fund operates inDependently, with its own investment objectives and strategies, but they Share common administrative, regulatory, and operational resources. This structure allows investors to switch between sub-funds easily, providing flexibility and diversification.
Examples:
- A mutual fund that offers various sub-funds targeting different Asset-classes/">Asset Classes, such as equities, Fixed Income, and real estate.
- A hedge fund structure that has separate investment strategies for different risk profiles while maintaining a single legal entity.
Cases:
- A retirement plan might use an umbrella fund to offer employees a choice of sub-funds, allowing them to allocate Assets according to their risk tolerance and retirement goals.
- An investment company may create an umbrella fund to launch multiple themed sub-funds (e.g., technology, healthcare) while streamlining compliance and reporting processes.