Institutional Fund

Institutional fund - It is when a mutual fund that targets a pension funds, endowments and other high net worth entities and individuals. In situational fund, usually have lower operating rates and a higher minimum investment that retail funds. Often their main investments are to reduce risk, so they invest in hundreds of different securities, which make them among the most diversified funds available. They also do not tend to trade securities very often, so they are able to keep operating costs to a minimum. Therefore, in the past investors normally needed at least 1 million in order to invest in an institutional fund nowadays some discount brokers offer investors to these funds for a smaller amount.