Fund of Funds
A fund may invest in the shares of one or more other funds to achieve improved asset allocation, diversification, or other investment objectives. A fund that primarily invests in other funds, instead of directly investing in debt or equity securities of operating companies, is commonly called a fund of funds. It is important to know that if your fund owns shares of another fund, you are paying the fees and expenses of your fund and indirectly paying the fees and expenses of the underlying fund (listed as the Acquired Fund Fees and Expenses in your fund’s prospectus fee table). Target date funds , also known as lifecycle funds, are typically funds of funds.
Concept at a glance
Definition and explanation
A fund may invest in the shares of one or more other funds to achieve improved asset allocation, diversification, or other investment objectives. A fund that primarily invests in other funds, instead of directly investing in debt or equity securities of operating companies, is commonly called a fund of funds. It is important to know that if your fund owns shares of another fund, you are paying the fees and expenses of your fund and indirectly paying the fees and expenses of the underlying fund (listed as the Acquired Fund Fees and Expenses in your fund’s prospectus fee table). Target date funds , also known as lifecycle funds, are typically funds of funds. [1]
Source-supported connections
Frequently asked questions
What does Fund of Funds mean in the cited reference?
A fund may invest in the shares of one or more other funds to achieve improved asset allocation, diversification, or other investment objectives. A fund that primarily invests in other funds, instead of directly investing in debt or equity securities of operating companies, is commonly called a fund of funds. It is important to know that if your fund owns shares of another fund, you are paying the fees and expenses of your fund and indirectly paying the fees and expenses of the underlying fund (listed as the Acquired Fund Fees and Expenses in your fund’s prospectus fee table). Target date funds , also known as lifecycle funds, are typically funds of funds. [1]
Fund of Funds connection map
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Links retain their source-specific meaning. Award-time affiliations and links to related reading are not claims about current appointments or economic causation.
Sources and review dates
Reviewed 23 October 2026. Historical dates and award-time affiliations retain their original context. A review date is not an event date. Background sources are identified separately from official records.