Fondsfonds

Fondsfonds, also known as fund of funds, are investment funds that invest in other investment funds rather than directly in individual securities like stocks or bonds. Instead of managing a portfolio of assets directly, a fondsfonds manager selects and allocates capital to a variety of underlying funds. These underlying funds may themselves be specialized in different asset classes, investment strategies, or geographical regions.

The primary objective of a fondsfonds is to achieve diversification and potentially simplify investment for the end investor. By investing in a fondsfonds, an investor gains exposure to a broad range of assets and strategies through a single investment vehicle. This can be particularly appealing to retail investors who may lack the time, expertise, or capital to build a diversified portfolio of individual funds themselves.

However, fondsfonds typically come with an additional layer of fees. Investors in a fondsfonds pay the management fees of the fondsfonds itself, as well as the management fees of the underlying funds in which it invests. This can lead to higher overall costs compared to investing directly in the underlying funds. The performance of a fondsfonds is also dependent on the performance of the chosen underlying funds, making manager selection and asset allocation crucial for success. Fondsfonds can be structured in various ways, including as mutual funds or alternative investment vehicles.