What Is an Umbrella Fund?

The umbrella fund is not strictly a fund, but a fund management company, in order to attract investors and expand the number of funds, regards a group of funds under its own name as a "parent fund", and forms a number of funds under the "parent fund" according to law As "constituent funds" (or several "constituent funds" under the same commodity or name), the purpose is to facilitate and attract investors to choose and switch among them freely. Umbrella funds are essentially a way of doing business. Its biggest feature is that it is convenient for investors to convert funds, and does not charge or reduce conversion fees to achieve the purpose of stabilizing and expanding investors; the disadvantage is that fund conversion is almost entirely determined by investors, and fund management companies have no right to interfere As a result, investors may frequently switch funds, affecting investment operations. ^[1]

Umbrella Fund

Right!

The umbrella fund is not strictly a fund, but a fund management company, in order to attract investors and expand the number of funds, regards a group of funds under its own name as a "parent fund", and forms a number of funds under the "parent fund" according to law As "constituent funds" (or several "constituent funds" under the same commodity or name), the purpose is to facilitate and attract investors to choose and switch among them freely. Umbrella funds are essentially a way of doing business. Its biggest feature is that it is convenient for investors to convert funds, and does not charge or reduce conversion fees to achieve the purpose of stabilizing and expanding investors; the disadvantage is that fund conversion is almost entirely determined by investors, and fund management companies have no right to interfere As a result, investors may frequently switch funds, affecting investment operations. ^[1]

(umbrella funds) Umbrella funds refer to the establishment of several sub-funds under a parent fund, and each fund makes investment decisions independently. Its main feature is that it can provide investors with multiple choices within the fund, that is, investors can switch the fund type according to their own needs without paying the conversion fee, which can provide investors with a certain choice without increasing costs . Generally speaking, umbrella funds are mostly a marketing concept.