Contract fund and limited partnership fund are two common forms of funds, which are consistent in some aspects, but there are also many differences. Many investors want to know the difference, which is also very helpful for investors to make investment decisions.

What is the difference between a contract fund and a limited partnership fund?

The legal basis of 1 is different. Contract funds are established on the basis of trust law, and limited partnership funds are established on the basis of company law.

2 The legal person qualifications of the two are different, and the contractual fund does not have legal person qualifications; A limited partnership fund is a company with legal personality.

The rights of investors are different. Investors of contractual funds are the beneficiaries of the funds and cannot interfere with the operation of the funds. Investors of limited partnership funds are actually shareholders of the company, and they have the right to participate in major decisions of the fund.

4 different financing methods, contract funds do not have legal personality, so they can not raise funds from banks; When a limited partnership fund wants to expand its scale, it can raise funds from banks.

5 They operate on different bases. A contractual fund operates the fund according to the contract between the trustee and the principal, and a limited partnership fund manages the fund according to the articles of association.

6 The conditions of fund termination are different. Contractual funds terminate when the contract expires, and limited partnership funds generally stop operating only when the fund goes bankrupt and liquidates.

Most funds in the United States are corporate funds, that is, limited partnership funds, while most countries and regions in Asia, including Japan, Hongkong and China, are contract funds, which constitute the mainstream funds in the international financial market.