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Investments glossary

Private Investment Fund


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A bad man, though raised to honour, always returns to his natural course, as a dog?s tail, though warmed by the fire and rubbed with oil, retains its form

— The Hitopadesa

A private investment fund is an investment company that does not solicit capital from retail investors or the general public. Members of a private investment company typically have deep knowledge of the industry as well as investments elsewhere. To be classified as a private fund, a fund must meet one of the exemptions outlined in the Investment Company Act of 1940. The 3C1 or 3C7 exemptions within the Act are frequently used to establish a fund as a private investment fund. There is an advantage to maintaining private investment fund status, as the regulatory and legal requirements are much lower than what is required for funds that are traded publicly.

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