Private Funds

What Is a Private Fund?
Private funds offer a limited number of investors (high-net-worth individuals and institutions) the opportunity to invest in assets that are not available via more traditional publicly traded funds, such as private companies, real assets, or credit.
Private funds are not listed on public exchanges. These funds give the investment manager greater flexibility in the types of investments that can be made to seek higher returns but are vehicles that can restrict access to capital for years. In addition, these funds are typically less regulated than public funds (they are subject to certain key regulations) and have certain risks, such as the lack of transparency and regulatory oversight.
Private funds have high minimum investment amounts and deploy capital over a specified time frame, after which the fund often divests its assets through initial public offerings, mergers or private sales.
Features
Private funds have the following features and potential benefits:

Diversification1
Access to scarce or lucrative opportunities that differ from traditional equities and bonds

Attractive risk-adjusted returns
Long-term investments with attractive stated internal rates of return

Lower volatility
Manage volatility by restricting redemptions and/or investing in private assets