feederfond

Feederfonds, or feeder fund, is an investment fund that does not invest directly in securities or assets. Instead, it allocates substantially all of its capital to another fund, the master fund, which is responsible for making the actual investments and managing the portfolio. The feeder fund and the master fund together form a master‑feeder structure. Investors buy shares in the feeder fund, and the feeder uses those proceeds to purchase shares of the master fund. Returns and risks are passed through to the feeder investors according to the master fund’s performance, subject to any fees assessed at the feeder level.

Feeder funds are commonly used in hedge funds, private equity, and related structures, and they are also found in UCITS and offshore fund configurations. They enable access for investors from different jurisdictions, currencies, or tax regimes while maintaining a single pool of assets in the master fund. This can yield economies of scale, co‑ordination of strategy, and simplified trading and compliance for the asset manager.

Fees and dependencies: fees may be charged at both feeder and master levels, depending on the offering documents and regulatory regime. The feeder’s risk and return profile are closely tied to the master fund; underperformance or losses at the master level affect all feeder funds linked to it. Regulatory treatment varies by jurisdiction and fund type, with feeder funds needing to comply with applicable securities, tax, and fiduciary requirements in their domicile.

Structure can involve multiple feeder funds feeding into a single master fund, sometimes with parallel or distinct share classes for different investor groups.