Umbrella Alternative Investment Funds

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Multiple Investment Compartments  -  Separate investment policies  -  Segregation of assets and liabilities  -  High level of flexibility to investors

All types of Cyprus Alternative Investment Funds (such as AIFs, AIFLNPs, and RAIFs), can be set-up as umbrella funds under the roof of which multiple investment compartments / sub-funds are created, allowing the management of separate asset pools with different investment policies, asset types and investor base.  

Umbrella Funds offer investors a high level of flexibility as they may switch investment strategies by switching investment compartments, easily, quickly and cost-efficiently.

Each compartment:

• is subject to the provisions of the Law as a separate AIF but all compartments   constitute a single legal entity

• issues units that correspond to its assets and have different values

• investors’ rights derive from the assets of the relevant investment compartment in which they are invested in, thus ensuring the ring fencing/segregation of the assets and liabilities of each compartment.

• may invest to another compartment but there are certain restrictions in the AIF law concerning the total position (up to 35%) and calculation of management fees shall avoid double counting

• may have its authorisation revoked by CySEC, be dissolved or liquidated separately without affecting the other compartments

The Umbrella AIF:

• is dissolved or liquidated only after all investment compartments are dissolved or liquidated

• Prepares consolidated financial statements at year end grouping the performance of the fund
  
  
  
  For more information check Alternative Funds (AIF) or contact Michael O. Ioannides.