For example, the purchaser may be attracted by a fund's star manager, performance history or strategy, whilst improving their counter-party risk and getting leverage, currency hedging or a capital guarantee via the derivative.
The structured product may be investible by retail clients or institutional investors that would not otherwise buy the fund, because of its provision of safeguard features such as capital guarantees or the appointment of independent administrators to calculate the underlying fund's value and additional oversight mechanisms.
Maturities might range from three to ten years, or more rarely multiple decades.
New structures are constantly being developed to suit market and client opportunities.
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