An umbrella fund is a
collective investment scheme
An investment fund is a way of investing money alongside other investors in order to benefit from the inherent advantages of working as part of a group such as reducing the risks of the investment by a significant percentage. These advantages inc ...
that exists as a single legal entity but has several distinct sub-funds which, in effect, are traded as individual
investment fund
An investment fund is a way of investing money alongside other investors in order to benefit from the inherent advantages of working as part of a group such as reducing the risks of the investment by a significant percentage. These advantages inc ...
s.
This type of arrangement originated in the European
investment management
Investment management is the professional asset management of various securities, including shareholdings, bonds, and other assets, such as real estate, to meet specified investment goals for the benefit of investors. Investors may be instit ...
industry, most notably with the
SICAV
A SICAV is a collective investment scheme common in Western Europe, especially Luxembourg, Switzerland, Italy, Spain, Belgium, Malta, France, and the Czech Republic. SICAV is an acronym in French for ''société d'investissement à capital variabl ...
(an
open-ended collective investment). The
SICAV
A SICAV is a collective investment scheme common in Western Europe, especially Luxembourg, Switzerland, Italy, Spain, Belgium, Malta, France, and the Czech Republic. SICAV is an acronym in French for ''société d'investissement à capital variabl ...
model was copied for the UK
Open-ended investment company An open-ended investment company (abbreviated to OEIC, pron. ) or investment company with variable capital (abbreviated to ICVC) is a type of open-ended collective investment formed as a corporation under the Open-Ended Investment Company Regulati ...
(OEIC) and
offshore fund
An offshore fund is generally a collective investment scheme domiciled in an offshore jurisdiction. Like the term "offshore company", the term is more descriptive than definitive, and both the words 'offshore' and 'fund' may be construed differe ...
models.
Advantages
The umbrella fund structure makes it cheaper for investors to move from one sub-fund to another and saves the
investment manager
Investment management is the professional asset management of various securities, including shareholdings, bonds, and other assets, such as real estate, to meet specified investment goals for the benefit of investors. Investors may be instituti ...
costs relating to regulatory duplication.
An umbrella fund can also be set up to provide retirement, death and other benefits to members of a participating employer. In such a fund there are several participating employers who enjoy more or less the same benefits and the fund is managed by professional trustees. They cut the cost by saving on maintenance and management fees and sometimes take advantage of reduced tax rates.
See also
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Collective investment scheme
An investment fund is a way of investing money alongside other investors in order to benefit from the inherent advantages of working as part of a group such as reducing the risks of the investment by a significant percentage. These advantages inc ...
s
*
Investment management
Investment management is the professional asset management of various securities, including shareholdings, bonds, and other assets, such as real estate, to meet specified investment goals for the benefit of investors. Investors may be instit ...
*
Mutual fund
A mutual fund is a professionally managed investment fund that pools money from many investors to purchase securities. The term is typically used in the United States, Canada, and India, while similar structures across the globe include the SICA ...
s
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OEIC
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SICAV
A SICAV is a collective investment scheme common in Western Europe, especially Luxembourg, Switzerland, Italy, Spain, Belgium, Malta, France, and the Czech Republic. SICAV is an acronym in French for ''société d'investissement à capital variabl ...
;Other umbrella terms
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Umbrella brand
Umbrella branding (also known as family branding) is a marketing practice involving the use of a single brand name for the sale of two or more related products. Umbrella branding is mainly used by companies with a positive brand equity (value o ...
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Umbrella organization
An umbrella organization is an association of (often related, industry-specific) institutions who work together formally to coordinate activities and/or pool resources. In business, political, and other environments, it provides resources and ofte ...
*
Umbrella school
An umbrella school is an alternative education school that serves to oversee the homeschooling of children to fulfill government educational requirements.
Umbrella schools vary greatly in what they offer and cost. Some offer group classes, a defin ...
*
Umbrella term
In linguistics, semantics, general semantics, and ontologies, hyponymy () is a semantic relation between a hyponym denoting a subtype and a hypernym or hyperonym (sometimes called umbrella term or blanket term) denoting a supertype. In othe ...
References
{{Investment-management
Investment funds