Luxembourg offers a range of structures to enable undertakings for collective investment (UCI), which are subject to different levels of regulation. The choice of structure is generally driven by the investment policy and the distribution strategy of the fund.
There are two main categories of UCI:
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undertakings for collective investment in transferable securities (UCITS), which comply with the European Directive on that subject;
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alternative investment funds, which cover all other types of fund including hedge funds, real estate investment funds, and venture capital and private equity funds.
Three legal structures are available:
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the common investment fund (Fonds commun de placement - FCP), which has no legal personality and which must be managed by a fund management company;
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the investment company with variable capital (Société d’Investissement à Capital variable - SICAV), where the capital varies in response to subscriptions and redemptions made by investors;
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the investment company with fixed capital (Société d’investissement à capital fixe - SICAF).
The SICAV and the SICAF may be self-managed or a fund management company may be appointed.
All these structures can be set up as stand alone funds, with single investment portfolios, or they can be structured as multiple compartment funds (also known as "umbrella funds") which create separate sub-funds (compartments) under the roof of a single legal entity. These sub-funds function as independent entities, each with its own investment policy, target distribution market and investor profile.
Each fund or sub-fund can, in turn, issue different classes of shares which vary, for instance, in the type and level of commissions. Thus enabling particular shares or units to be tailored to the needs of a specific market or clientele (institutional or private).
UCITS funds must be set up in accordance with the rules prescribed by the European Union and may only invest in certain investment classes. UCITS funds can be purchased by investors in any European country where they are authorised for sale, and in a number of countries in other regions or on other continents where they are permitted, such as certain Asian countries.
Regulated or
Unregulated 
