Advantages for fund management companies:
Significantly greater flexibility in investment rules compared to mutual funds, including the possibility of higher concentration, the use of derivative strategies, leverage, and investments in illiquid assets. At the same time, certain requirements for diversification and risk spreading remain.
Investment strategies can be designed more freely, e.g. as hedge fund strategies or absolute return strategies.
Special funds may be marketed to the general public, i.e. to both professional and non-professional investors.
Advantages for unit holders:
Special funds provide the investors access to more specialised investment strategies, while typically offering a higher degree of transparency, and more frequent subscription and redemption compared to other AIFs.
Note:
Not harmonised at EU level.
The Swedish Alternative Investment Fund Managers Act (2013:561)