Single funds

In Liechtenstein, most funds are joint capital investments (pooled assets) in the form of single funds that invest in various risk categories (direct investments in bank deposits, securities, derivatives, real estate, etc.).

Umbrella construction with fund compartments

Liechtenstein permits umbrella constructions that can launch any number of fund compartments (sub-funds) which as a whole, however, constitute one single legal entity (the umbrella).

Noteworthy advantages:

• Different types of investment products can be marketed as a unified “all-in-one” package.
• Only one prospectus/trust agreement must be prepared for an umbrella con­struction.
• Reporting (semi-annual / annual reports) can be bundled because the financial year is identical across all products.
• The advantage for the investor is that fund switching costs little or nothing.
• New compartments (sub-funds) can be added.

Fund of funds

• A fund is called a fund of funds if it invests most of its assets in units of other invest­ment funds (target funds).
• If the fund of funds complies with the investment regulations of an undertaking for collective investment in transferable securities (UCITS), it will also have the status of an undertaking for collective investment in transferable securities (UCITS).
• Alternative Investment Funds (AIFs) can invest their assets in units of other investment funds without having to observe the restrictions that apply to undertakings for collective investment in transferable securities (UCITS).
• The prospectus and the constitutive documents must mention that the fund is a fund of funds.

Combination options

Investment categories

• Money market funds
• Bond funds
• Convertible bond funds
• Mixed funds (objective fund)
• Equity funds
• Real estate funds
• Non-traditional investment funds (hedge funds, etc.)

Investment types

• Country or region funds
• Industry funds
• Blue chip funds or small cap funds
• Theme funds
• Global funds
• Index funds (tracking of an index)
• Core satellite funds

Characteristics

• Public funds or funds for qualified investors
• EU-compatible funds (UCITS) or alternative investment funds (AIFs)
• Actively or passively managed funds
• Dividend-paying or reinvesting funds
• Funds with or without duration restrictions

Reference currency

• Funds denominated in the investor’s domestic currency
• Single-currency forex funds
• Multi-currency forex funds

Fee structure

• Issue premium / redemption charge
• Administration fee
• Performance fee
• All-in fee
• Variable charges