An investment fund is a very liquid investment: You can sell your units or shares or return them to the fund company at the current redemption price at any time. This is particularly the case for UCITS which are required by law to be open-end funds, i.e. to allow investors to withdraw their money whenever they want.
However, this is not the case with closed-ended funds. These funds generally have a finite, but relatively long duration (10 to 20 years) and collect a likewise pre-established amount of capital in order to finance long-term, often illiquid projects (such as real estate projects). Once this amount is reached, the fund is closed and does not accept new investment money. In principle, investors may leave the fund only at the end of its life cycle.
Investing in an investment fund requires little effort. It is not necessary to constantly monitor the evolution of financial markets and the various securities in which it has invested. That is the task – and the job! – of the fund manager. You thus benefit from professional management of your assets at relatively modest costs.
Finally, an investment fund can also give you access to specific and exotic markets where an individual investor would have difficulties to invest.
