Investment Fund Structures
Alternative investment manager can launch a fund using structures such as a master-feeder structure, a side-by-side structure, along with side pockets and different share classes depending on the type and residence of the prospective investors.
Master-Feeder
The master-feeder structure is a combined hedge fund structure in which the domestic and offshore funds feed into a single onshore/offshore master fund. The master-feeder structure allows U.S. investors to contribute to the domestic fund, while foreign investors and tax-exempt U.S. investors can participate in the offshore fund.
Side-by-Side
Side-by-side structure is where the domestic fund and the offshore fund are incorporated to manage the fund strategy pari passu in both funds without a master fund. A side-by-side structure is used more often for fund of funds, as there is a significant amount of work involved to effect a trading strategy as well as the duplication of administration for the two funds.
If you are an emerging manager, plans to launch fund, here you can find a comprehensive guide about which jurisdiction you can use to optimize your fund launch
Knowledge Resources for Hedge Fund Managers
The Akram Brief
Please read our blog regarding key considerations for selecting a fund structure before investment manager raises outside capital from investors.