1. The definition of umbrella fund The so-called umbrella fund is also called "umbrella sub-fund" or "umbrella substructure fund". It is a form of fund organization established by a fund management company. Usually, this kind of fund is that the sponsors set up several funds that can only be converted according to the prescribed procedures and rates according to a general fund prospectus, that is, they set up several sub-funds under a parent fund, such as bonds, index funds and stock funds.

For example, China Merchants Antai series funds set three different risks according to investors' different preferences or risk tolerance-income-level sub-funds: China Merchants Bond Fund, China Merchants Balanced Fund and China Merchants Equity Fund; Cai Xiang Hefeng Industry Series Fund consists of three types of funds: value optimization growth type, cycle type and stable type. The diversity of fund types provides investors with broader investment opportunities.

2. The management of each sub-fund is independent, and independent investment decisions are made according to their different investment objectives. Investors can choose their own sub-funds and transfer their investment from one sub-fund to another without paying or paying less conversion fees. Compared with the fund with single structure, the emergence of umbrella fund is the innovation of financial investment concept.

3. The main characteristics of umbrella fund (1) This kind of fund can provide investors with a variety of investment options, which can facilitate investors to choose different sub-funds according to changes in market conditions, thus reducing the switching cost and attracting investors.

(2) It is beneficial for fund management companies to stabilize customers and reduce the pressure of redemption. With the increase of the number of open-end funds and the fluctuation of financial market, an important problem that fund management companies will face is how to attract and stabilize investors.

4. For example, Cai Xiang Hefeng industry category funds are mainly based on the stock market, and sub-funds are divided according to industry characteristics; The sub-funds of China Merchants Antai Series Fund are classified according to the characteristics of risk and return. They invest not only in the stock market, but also in the bond market.