Institutional Fund

AAA

DEFINITION of 'Institutional Fund'

A fund that targets high value investors with low management fees, but very high minimum investing requirements. Institutional funds refers to funds that aim to manage money for large institutional investors, such as pension or endowment funds. These funds will typically offer much lower MERs than retail funds, but also mandate a minimum investment much greater than most other funds, some hedge and private equity funds withstanding.

INVESTOPEDIA EXPLAINS 'Institutional Fund'

These funds must indicate within their prospectuses or name that they're institutional and typically solicit managers of retirement plans, institutional investors and large endowment trusts. These funds can take almost any form, be it a mutual fund, private equity fund, hedge fund or venture capital fund. The defining trait of institutional funds are the clientele they cater their services to.

RELATED TERMS
  1. Private Equity

    Equity capital that is not quoted on a public exchange. Private ...
  2. Hedge Fund

    An aggressively managed portfolio of investments that uses advanced ...
  3. Expense Ratio

    A measure of what it costs an investment company to operate a ...
  4. Institutional Investor

    A non-bank person or organization that trades securities in large ...
  5. Endowment

    A financial asset donation made to a non-profit group or institution ...
  6. Mutual Fund

    An investment vehicle that is made up of a pool of funds collected ...
Related Articles
  1. Bonds & Fixed Income

    Passing The Buck: The Hidden Costs Of Annuities

    These may look like good retirement vehicles, but beware of the fees buried in the fine print.
  2. Fundamental Analysis

    Introduction To Institutional Investing

    Investopedia explains: Learn about institutional investing and all of the major players in this field.
  3. Mutual Funds & ETFs

    How To Pick A Good Mutual Fund

    Learn how to evaluate mutual funds and find the right one for you.
  4. Insurance

    The Dangers Of Over-Diversifying Your Portfolio

    If you diversify too much, you might not lose much, but you won't gain much either.
  5. Mutual Funds & ETFs

    That's A (Mutual Fund) Wrap!

    These advisory programs offer professional supervision and other handy tools for building a diversified portfolio.
  6. Mutual Funds & ETFs

    How do hedge funds use short selling?

    Learn how hedge funds use short selling to profit from stocks that are falling in price. Explore different analytical techniques hedge funds employ to find investments.
  7. Mutual Funds & ETFs

    What are the risks involved in keeping my money in a money market account?

    Setting aside funds in a money market account can be a safe investment strategy, but investors should be aware of the risks inherent to money market options.
  8. Mutual Funds & ETFs

    How much of my total assets should I be keeping in my money market account?

    Investing a portion of total assets in a cash position such as a money market account provides investors access to funds in the case of an emergency.
  9. Mutual Funds & ETFs

    Does it make sense for me to have a money market account if I don't want to buy any securities?

    Saving funds within a money market account or mutual fund does not have to be limited to those wanting to buy or sell securities in the near future.
  10. Mutual Funds & ETFs

    Why would you keep funds in a money market account and not a savings account?

    Read about the differences between money market accounts and savings accounts, and see why a depositor would elect a money market over a savings account.

You May Also Like

Hot Definitions
  1. Command Economy

    A system where the government, rather than the free market, determines what goods should be produced, how much should be ...
  2. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  3. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  4. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  5. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  6. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
Trading Center