Definition of master-feeder fund

This structure is commonly associated with hedge funds and is used to pool together assets from both foreign and local investors in order to keep costs down, achieve better economies of scale and better tax efficiencies.

Investors place their money in one of several funds known as “feeders”. The feeders, in turn, invest their assets in one “master fund,” which makes all the investment decisions for the portfolio. The master fund is typically located offshore and the management and performance fees are paid at feeder fund level. [1]

FT Articles & Analysis

No articles are associated with this term

Related Terms