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The master–feeder structure is a technique for structuring investment funds. It allows asset managers to capture the efficiencies of larger pools of assets although fashioning investment funds to separate market niches.
One or more investment vehicles pool their portfolios within another vehicle – several smaller feeder funds contribute to one master fund.
Sometimes, especially when the feeders are hedge funds, this is a way of complying with the legal systems of distinct jurisdictions. For example, an onshore feeder fund and an offshore feeder fund contribute to the same master portfolio.
This is also sometimes called a hub and spoke structure.
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