Alternative investment funds
In Luxembourg, contrary to the situation in a number of offshore financial centres, alternative investment funds are subject to specific regulation and to control by the financial sector supervisory authority.
Alternative investment funds nevertheless benefit from wide scope with regard to their investment policy. They are authorised to invest in derivatives such as options, warrants, swaps and futures contracts and to use specific investment techniques. They can enter into repurchase agreements as buyer or seller. They can enter into securities lending transactions, use short selling techniques and be leveraged on a permanent basis for investment purposes.
Most Luxembourg alternative investment funds are created in the form either under Part II of the law of 20 December 2002 on undertakings for collective investment replaced by Part II of the law of 17 December 2010, or as a specialised investment fund (SIF).
Our brochure Luxembourg Hedge Funds provides an overview of the different structures available.
Further information can be found on the website of the Association of the Luxembourg Fund Industry (ALFI).
Practical guide:
How to set up a non-UCITs (Part II) fund