Customers buy sub-funds, and sub-funds buy parent funds. In this way, the establishment of multiple sub-funds under the parent fund can expand the scale. In addition, since the number of investors in private equity funds cannot exceed 200, the structure of parent-child funds can get rid of this restriction.
Extended reading:
Private parent fund: also known as the fund in the fund, referred to as FOF, is actually a fund that invests in other funds. By pooling a large amount of capital, private equity parent funds can establish cooperative relations with many excellent investment institutions, become their "Limited Partners (LP)" and share the investment results.
Advantages of private parent fund
1, lowering the threshold for cooperation. The parent fund has greatly lowered the threshold of sharing rent with institutional investors, and the general threshold has been reduced to about 654.38+0 million.
2. Reduce investment risks. Private equity parent funds can cooperate with multiple institutional investors at the same time to minimize risks.
3. Less affected by market fluctuations. The investment cycle of private equity parent funds is often a closed period of several years. In this process, the parent fund manager will strengthen his investment strategy. This persistence will often help investors avoid the market trough, quit at the peak and enjoy the dividends brought by time and compound interest.
Which fund should I choose as my fixed investment f