Fund of Funds
A fund of funds is a private equity fund that invests in multiple private equity funds. Fund-of-funds are set-up to diversify investor money across funds with different strategies or operating in different geographies. These funds also leverage relationships and provide access to well-established private equity funds that may otherwise not be open to smaller investors. Fund-of-funds promoters' layer in an additional fee on top of the fees already associated with the funds being invested in.