What is a manager of managers fund?

A type of multi-manager investment fund that uses multiple investment managers who are specialists in different asset classes.

Where have you heard about manager of managers funds?

You may hear multi-manager funds pitched as a ‘one stop shop’ for small-scale investors who want a diverse portfolio. There are two types of multi-manager fund: fund of funds and manager of managers.

What you need to know about manager of managers funds.

The theory behind a manager of managers (MoM) fund structure is that you can have a balance of asset classes, with each class managed by an expert in that field. The MoM then tracks the performance of individual managers and can make changes based on their performance and the fund objectives. It's an alternative to having one investment portfolio manager who makes all the investment decisions but may not be an expert in all asset classes.

If you have a small amount of money to invest, a MoM fund allows you to get a diverse portfolio in a single investment. The downside is that you’re likely to pay higher charges as you’re effectively paying for two layers of management.

Find out more about manager of managers funds.

An alternative type of multi-manager investment is a fund of funds. Find out how this differs from MoM in our definition.