The LUXIF concept: an onshore investment fund structure for investment professionals
LUXIF is a multi-manager investment platform, designed especially for investment professionals who have a specific need for a cost-effective, tailored onshore investment fund structure. It allows a fast set-up of their own sub-fund, with the investment policy and features of their choice.
Each LUXIF sub-fund is treated as a separate entity and operates independently, under the lead of an investment fund manager to whom the investment management of the sub-fund may have been delegated by the general partner of LUXIF, and in accordance with Luxembourg onshore fund regulations.
What is LUXIF ?
More precisely, LUXIF is a Luxembourg investment company with variable capital (SICAV - société d'investissement à capital variable) specialised investment fund (SIF - Fonds d'Investissement Spécialisé) governed by the Luxembourg law of February 13th, 2007 relating to specialised investment funds as amended, and the Luxembourg law of August 10th, 1915 on commercial companies as amended.
LUXIF was incorporated on June 24th 2010 and was transformed into a corporate partnership limited by shares (société en commandite par actions) on November 18th, 2010.
It is managed by its general partner, LUXIF Management S.à r.l., whose board of managers is currently composed of three members, all approved by the Luxembourg regulatory authority (the Commission de Surveillance du Secteur Financier).
As a SIF (Specialised Investment Fund), LUXIF's purpose is to invest the funds available to it in any type of assets such as Private Equity, Hedge Funds, Fund of Funds and other alternative strategies, within the broadest possible meaning, with only a single risk spreading rule, according to which one target investment may not amount to over than 30% of sub-fund's assets.
Which investors for LUXIF ?
LUXIF may issue any type of securities (most often, shares), which are reserved to "well-informed investors” relating to specialised investment funds, and who are:
- Institutional Investors, such as credit institutions, undertakings for collective investment, insurance companies, social security institutions, pension funds, local authorities, unregulated investment companies (conditions apply), professionals of the financial sector etc.;
- Professional Investors, which are defined by "MiFID” (the Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments), targeting any “client who possesses the experience, knowledge and expertise to make its own investment decisions and properly assess the risks that it incurs”;
- Any other investor either investing a minimum of EUR 125,000.- or who has been the subject of an assessment made by a credit institution (within the meaning of Directive 2006/48/EC), by an investment firm (within the meaning of Directive 2004/39/EC) or by a management company (within the meaning of Directive 2001/107/EC) certifying his expertise, his/her experience and knowledge in adequately appraising the considered investment. Most often, (Ultra) High Net Worth Individuals (HNWI) and other experienced investors invest are found in that category.
How are LUXIF sub-funds related among each other?
LUXIF is an “umbrella fund”, which means that it can host an infinite number of “sub-funds”, each of which have distinct features and investment policies, and whose respective assets and liabilities are strictly segregated from those of other sub-funds. Each LUXIF sub-fund is by law completely separate and autonomous.
Creditors of one sub-fund have no recourse against the assets of another sub-fund. Each sub-fund’s investments portfolio is invested for the sole benefit of the relevant sub-fund. Subscription of shares of a particular sub-fund does not give the holder of these shares any rights with respect to another sub-fund. “Sub-funds” are also often referred to as “compartments”, “segregated portfolios” and “units”.
Within a sub-fund, an unlimited number of shares, of one or more classes may be issued, generally subject to (inter allia) different fee structures, income distribution rules, marketing targets, reference currency. Each sub-fund and each class of shares thereof has a separate net asset value, calculated with the frequency the initiator wishes to give to it.
How to set-up a new LUXIF sub-fund?