Fund of funds

(redirected from Umbrella funds)

Fund of funds

A mutual fund or hedge fund that invests in other funds.

Fund of Funds

A mutual fund that invests exclusively in other mutual funds. Theoretically, funds of funds allow the investor to diversify risk even more than in a regular mutual fund without reducing return significantly. One disadvantage is the fact that most funds of funds have higher fees because shareholders have to pay fees for the funds of funds themselves and must also pay fees for the underlying funds. Funds of funds were especially popular in the 1960s.

fund of funds

An open-end investment company that invests only in the shares of other open-end investment companies. This type of mutual fund was popular during the 1960s but subsequently fell into disfavor with investors. Many analysts consider it more of a gimmick than a useful investment vehicle.

Fund of funds (FOF).

A fund of funds is a pooled investment, such as a mutual fund or a hedge fund, whose underlying investments are other funds rather than individual securities.

Despite some major differences, what all funds of funds have in common is an emphasis on diversification for its potential to reduce risk without significantly reducing return.

They're also designed to simplify the investment process by offering one-stop shopping.

Many mutual fund FOFs are asset allocation funds and typically include both stock and bond funds in a particular combination that the FOF manager has chosen to meet a specific objective. A mutual fund FOF may select all its funds from a single fund family or it may choose funds offered by different investment companies.

A hedge fund FOF, which owns stakes in other hedge funds, allows investors to commit substantially less money to gain exposure to this investment category than it would cost to invest in even one fund.

A major drawback with all funds of funds is that the fees tend to be higher than you would pay owning the underlying funds directly.

References in periodicals archive ?
Fitch sampled 17 umbrella funds governing more than 50 sub-funds.
New laws have also been issued for Protected Cell Companies (umbrella funds or segregated portfolios) and a flexible Trusts Law, following stakeholder engagement to identify areas of opportunity for Bahrain and the broader region.
The New Fund Regulations introduce the concepts of feeder funds and umbrella funds. Under the New Fund Regulations, a feeder fund is a public investment fund or part of a group of funds for an umbrella fund which invests at least 85% of its assets in the units of a public master fund or foreign public fund and is excluded from investing in negotiable securities and certain other investments determined by SCA.
Ishtiaq Urmar when asked about non allocation of funds for the zoo in KP budget 2016-17 said Rs 120 million have been already approved for this mega project and if required more funds would be provided from the umbrella funds of Environment Department.
Plus, the Army would be rendered as less productive in time , if all the wars fought were dissolved and peace actually endured, leaving no justification for the Armed forces to justify the huge umbrella funds earmarked for them every year.
The portfolio consists of 54 direct and umbrella funds in Europe and the USA.
This is patently out of self-interest of fund administrators specifically, who aim to herd private funds into their umbrella funds, unfortunately with the full support and cooperation of the SA regulator!
Allowing the protected cell company structure to be used for umbrella funds;
The fund is part of an Umbrella Funds Company that is registered in the DIFC under the name Mashreq Capital Shariah Compliant Funds (OEIC) Ltd.
For those savers who seek medium to long-term investment products, but have used up their ISA allowance, offshore investment bonds (also referred to as umbrella funds) can prove a valuable addition to a personal savings portfolio.
American Express and Faisal Finance have launched the Islamic Multi-Investment Fund, one of a growing number Islamic-based umbrella funds. This one hopes to raise about $100 million by the end of the year.
Ishtiaq Urmar when asked about non allocation of funds for the zoo in KP budget 2016-17 said , Rs 120 million have been already approved for this mega project and if required more funds would be provided from the umbrella funds of Environment Department.