Master-Feeder Fund Structure

What is a Master-Feeder Fund?

The Master-Feeder fund structure is a common way that hedge funds are set up to accept assets from both foreign and domestic investors in the most tax and trading efficient manner possible. It helps route assets from investors who may be from say the EU along with US tax exempt and taxable investors all into one central fund. The "master" or central fund is usually located somewhere offshore in somewhere like Bermuda.

While setting up a master-feeder fund may appear complex the first time a hedge fund works through the process the result is a more efficient method of raising assets internationally in a manner that allows flexibility to adapt to country-specific regulations.

Read dozens of additional articles like this within the guide to Hedge Fund Terms and Definitions.

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- Richard

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Related Terms:Master Feeder Fund, Master-Feeder Funds, Master-Feeder Fund Structure, Master Feeder Fund Setup, Master-Feeder Fund Options
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