Captive Fund
Captive funds are investments that are offered to a single group of lucky bastards...er, we mean to a single group of well deserving, talented employees (or to a private entity). Similar to Z Shares, captive funds can be managed internally by the company or by a professional (like an institutional investment manager), and can also be used as an alternative investment vehicle for venture capital assets.
Seen as a lucrative employment perk by many, these funds manage employee capital and typically have a better rate of return than publicly traded funds. But they're not offered to the public nor are they available on any exchanges. Stinks right (well, at least for the rest of us)?
An example: the legendary, mega Medallion Fund from fund manager Renaissance Technologies, whose captive fund historically boasts fat, stratospheric returns for its employees year over year. How fat? Let's just say their employees aren't worried about eating beans and weenies every night or having enough to retire on. Wish you could participate? Us too, but don't quit your day job. We hear their employee turnover rate is pretty low...Wonder why that is?
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Finance: What is an Omnibus Account?111 Views
Finance a la shmoop. What is an omnibus account?
Herbi just eats leaves, Carni just eats meat, Omni well it's pretty much [Different buses eating stuff]
everything. So yeah an omnibus as in bus-i-ness or business account services is
a bunch of investors who've all pitched in or wired in their capital to become a
percentage owner of that omnibus account. Why would people do this? Scale, volume,
discounts size, heft. When you have a lot of money in an account basic things like [Lots of money in a suitcase]
audit and legal fees and brokerage services and the fees with them and
other one-off costs get amortized across a lot of people in dollars invested [Definition of Amortization]
rather than being laid entirely or solely on one investor where they can
then be a meaningful percentage of the total and with an omnibus account you [Bus labelled Omni eating leaves]
also get anonymity since it's a broker dealing in street name with the account [Anonymity stamp]
interfacing with the street well investors can live if they want in the
lovely dark shadows of Erewhon. Omnibus accounts are sort of like your own [Full moon in a dark sky]
custom mutual fund without the whole nav, net asset value stamp requirements at
the end of each trading day and all the other regulations and filings and legal
crap needed for publicly offered securities it's like having a fully [Book labelled my very own omnibus account]
gassed up bus with a working GPS and Waze system you can drive anywhere you [Guy sat on a bus]
want on the investing landscape you don't have to tell anyone outside of
your own partners about it, and it works great as long as you all want to eat the
same kind of financial cooking.. [Omni asking Carni if he is going to finish his food]
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