Funds of Funds and Liquid Alternatives
Free CAIA Level I lesson in Funds of Funds. 45 min read, ~6,785 words.
A FoF manager performs four functions: strategy and manager selection, portfolio construction, risk management and monitoring, and due diligence (including operational due diligence). HF FoFs deliver 11 named benefits (diversification, access, fee negotiation, etc.) but carry 6 specific disadvantages (double fees, no netting, taxation, transparency, cash-flow contagion, loss of control)...
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Key Takeaways
- Exam Shortcuts
Learning objectives
- fof overview
- pe fof
- pe fof process
- pe fof investment
- pe fof returns
- hf fof overview
- hf fof investing
- single hf portfolios
- liquid alts
- fof returns
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