Closed fund

from Wikipedia, the free encyclopedia

A closed-end funds or closed-end investment fund ( English closed-end fund , hence the acronym CEF ) is a mutual fund in which a fixed number of investment certificates or a fixed amount of capital is raised, can be returned without fund shares to the fund itself. Unlike an open-ended fund, the fund manager does not issue new shares to satisfy further investor demand.


In Germany, a closed fund is always an alternative investment fund within the meaning of the Capital Investment Code . The design as a closed-end fund does not make any statements about the asset classes included . The investment fund can only be invested within a specified placement period, after which the fund will be closed.

As a rule, a German closed-end fund is designed in the legal form of a GmbH & Co. KG .

Legal basis

The Capital Investment Code (KAGB) has been in force for managers of closed and open-ended investment funds since July 22, 2013 . Here the European directive for managers of alternative investment funds (AIFM directive) is implemented in German law. In the KAGB, closed-end funds are considered alternative investment funds (AIF) and are divided into mutual and special funds. With the KAGB, Germany has for the first time a common set of rules for providers of open and closed investment funds. Since the closed-end fund market was not subject to any state control other than prospectus liability before it was regulated by the KAGB , it was referred to as part of the gray capital market . Since the regulation, the closed fund no longer belongs to this (largely) unregulated part of the capital market.

Essential components of the regulation by the KAGB are, for example

  • the regulation of product providers as a capital management company
  • a distinction between so-called “risk-mixed” and “non-risk-mixed” funds
  • the introduction of a depositary
  • a limit on the Fund's leverage
  • a limit on the inclusion of foreign currencies

In addition, each initiator of closed funds must have the investment conditions approved by the Federal Financial Supervisory Authority (BaFin) before the start of sales and notify BaFin of the start of sales. Even if the BaFin audit now goes much further than before the regulation, the BaFin does not carry out a business audit.

Industry associations, market volume

The main providers of closed funds organized themselves in the industry association Bundesverband Sachwerte und Investmentfonds (bsi). In June 2017 it became known that the bsi will be integrated into the ZIA Central Real Estate Committee . Among other things, this reflects the market development. Because while in previous years - especially before the financial crisis - a significant part of investor money flowed into asset classes such as ship funds , media funds and life insurance funds, since the regulation by the KAGB in 2013 at the latest, sales have concentrated heavily on real estate funds .

According to a survey by the industry magazine Cash, a total of around € 6.6 billion in equity was invested in closed-end funds, around € 2.4 billion of which from private investors and around € 4.2 billion from institutional investors. If you add the borrowed capital raised by the funds, the investment volume is € 9.3 billion. In addition to real estate, container funds, aircraft and private equity were able to record noteworthy sales successes.

From conception to resolution

Timeline: phases of a closed fund

Before a closed fund is created through the establishment of the fund company (usually a GmbH & Co. KG), it must be designed: At the beginning there is usually (except for so-called "blind pools" - see below) the acquisition of the investment object. This is pre-financed by the fund company with outside capital. As a rule, this is partly a long-term debt financing that the fund maintains during the holding period and partly a bridging loan for the equity to be raised. A business plan is drawn up that proves the profitability of the company. In addition, the management of the fund company (usually the capital management company) negotiates all relevant contracts. The sales documents are then created along with the investment conditions and the latter submitted to BaFin for review and approval. After approval and distribution notification to BaFin, the equity placement of the fund begins - usually through banks, savings banks and / or independent financial service providers. The short-term interim financing is replaced by the equity raised from investors. If sufficient equity has been collected, the fund is closed for further new investments and changes to the operating phase: In the following years, the company manages the investment object; The management usually commissions a service provider for this. The management of the fund makes the decisions on ongoing operations and, as a rule, also on the sale of the investment property. The management is subject to various controls. The custodian monitors the cash flows, the annual financial statements are checked by auditors and the shareholders' meeting approves the discharge of the management. After the investment property has been sold, the fund is liquidated: The investment object is sold, the sales proceeds are distributed to the shareholders and the company is then dissolved.

Closed funds according to investment objects

Costs, opportunities and risks


In addition to the real ancillary acquisition costs of the investment (in the case of real estate e.g. real estate transfer tax and costs for brokers , notaries and land register entries ), there are also fund-specific costs such as costs for the conception, the procurement of outside capital or the procurement of equity. The cost of raising equity also includes the commission for any intermediaries such as banks, savings banks or independent financial advisors. Often, part of these costs is covered by a front-end load . The total initial cost is called the initial cost. In addition, the fund also has to bear ongoing annual costs, which are partly caused by the management of the investment property, but partly also caused by the management of the fund (e.g. costs of investor care and the management of the fund).


In earlier years, closed-end funds were often used as tax deferral models: up to November 11, 2005, closed-end funds were set up with (in the initial phase) calculated high losses for the company in order to provide the investor with tax loss allocations. If you had a high marginal tax rate as a private investor , you could postpone the taxation date to later when the personal tax rate will probably be lower by participating in a closed fund. In this case, it was not a question of tax savings, but rather of tax deferral models. These possibilities have now been largely restricted by the legislature. With the introduction of § 15a and § 15b EStG , the legislature introduced a restriction on loss offsetting for limited partners. Section 15a of the Income Tax Act regulates that a loss offsetting is excluded if a negative capital account of the limited partner arises or increases due to the loss share. This is justified by the fact that the limited partner is only liable to a limited extent (with the amount of his contribution). In this respect, he should only be able to offset and offset losses up to the amount of his contribution under tax law. Section 15b of the EStG regulates the prohibition of tax deferral models, according to which losses in connection with a tax deferral model may not be offset against income from commercial operations or income from other types of income.

Since 2005, the closed fund has therefore developed from a tax deferral to a yield object. One of the main goals is to generate an above-average return after taxes. For this purpose, tax specifics of the individual assets (e.g. the tonnage tax for ships or the depreciation of real estate), but also special concepts (e.g. foreign permanent establishments ) are used.

In the meantime, the function of the closed fund is essentially to make capital goods available to investors, which are otherwise only available to large investors as investment objects, starting at low five-digit amounts.

Another important aspect of the return results from the fact that the holding company's cash management is limited to the operationally expected costs and a liquidity reserve. The peculiarities of closed-end investments, unlike open funds , do not require a reserve of cash in order to pay out investors willing to exit. Since the cash reserve in the fund is usually much lower, the return is not reduced by the weighted money market interest rate.


Depending on the type, there are specific risks for the asset (for example, in the case of real estate, the rental risk or, in the case of ships, the risks of the shipping markets). These are not shown here as they are independent of the construction of the closed fund.

Total loss risk

Since participation in a closed fund is not a savings deposit, but participation in a company, protection by a deposit protection fund naturally does not apply . If the fund company's income (e.g. rental income) is no longer sufficient to cover the fund company's expenses (e.g. borrowing costs such as interest and repayment), the fund company goes into bankruptcy. This leads to the total loss of the invested capital for the investors. For funds that were set up after the regulation by the KAGB, there are - in contrast to earlier - no further obligation for investors to make additional contributions .

Lack of fungibility

The investor is committed to the participation over the term. A stock exchange trade or a daily price determination with the associated possibility of returning to the initiator, such as with investment funds, cannot exist due to the design. In order to increase the tradability, a secondary market has been established for the realization of returned investments , e.g. B. on the Hamburg Stock Exchange or the Fund Exchange Germany . In particular, the underlying articles of association often provide for a co-determination right of the initiator, so that transfers between two contracting parties may only be made subject to the approval of the fund management. Approval can usually only be refused for “good cause”, but the transfer of participation is subject to change. Interestingly, an "important reason" may e.g. B. too low a price, because this would influence the assessment of the participation of all other shareholders.

Conflicts of interest on the part of the initiators

Notwithstanding the Sales Prospectus Act, which came into force in 1998, and the executive Sales Prospectus Ordinance, BaFin only checks the formal completeness of the information, but not its truthfulness.

It is not uncommon for the founding limited partners and initiators to manage their own pockets by concluding contracts with their own companies at correspondingly advantageous conditions for themselves in addition to the not inconsiderable soft costs of sometimes over 25%. This approach is often not noticeable because investments in closed funds are mainly mediated as fiduciary and the trustee is often dominated by the initiators and / or the founding companies.

Since the regulation, conflicts of interest have to be presented in the sales prospectus - see Section 27 of the KAGB.

Loss of tax advantages

With the old-style tax deferral models (until 2005) described above, there was also the risk of losing the planned tax advantages. If the tax office assumed that the fund did not intend to make a profit, the tax advantages received were subsequently lost. Losses from tax deferral models that the taxpayer joined after November 10, 2005 or for which external sales began after November 10, 2005, may not be offset against income from commercial operations or income from other types of income ( Section 15b EStG).

Tax aspects

The tax treatment of closed-end funds depends on the activity of the fund and its legal form. As a rule, the investor has either income from renting and leasing or income from commercial operations ; in rarer cases he can also have other income or income from capital assets .


Blind pool

The investment objects are not always determined when the fund is launched. If the investor invests in a fund for which at the time of the investment decision no specific investment object has been determined, one speaks of a so-called “blind pool” (alternative spelling: “blind pool” - but the term is not found in Duden), German 'Dark pool' or 'pig in a poke'. If the investor already knows the first investment objects, but not all of them because the fund plans to invest during or after raising capital, one often speaks of a "semi-blind pool".

Such constructions require the investor to have great confidence in the competence and efficiency of the fund management company and the capital management company, because in the end he invests in their know-how . As a rule, the prospectus describes in detail the selection criteria according to which the fund management will select the investment items to be acquired.

In some market segments (e.g. private equity) the blind pool is the usual construction. It has also been found more frequently in the real estate sector in recent years; this is due, among other things, to the fact that the capital management company does not require bridging equity financing with this variant (see above). Thus, the blind pool also enables product manufacturers with less creditworthiness to access this market segment.

Naturally, this construction gives rise to special risks, because the investment property cannot be assessed by the investor before investing. It is also uncertain whether the fund management will be able to find enough investment properties that meet the criteria defined in the prospectus. This includes the risk that the spread over the planned number of investment properties will be significantly lower than planned.

Tax bases of the earlier tax deferral models

Until 2005, closed funds were regularly designed as tax-saving models. The tax savings in closed real estate funds were achieved through high special write-offs . Special depreciation allowed the Berlin Promotion Act (BerlinFG) to promote West Berlin and the Development Areas Act (FördGG) for supporting the setting in the former East Germany. In the case of media funds, tax savings were achieved by prohibiting the activation of self-created intangible assets ( Section 5 (2) EStG). The created film right may not be activated; the total production costs of the respective film are immediately deductible operating expenses. In the case of ship funds , the tonnage tax, a flat-rate income tax based on the size of the ship (tonnage), enables tax savings. The Federal Minister of Finance has repeatedly tried to regulate the tax assessment of the funds through decrees (so-called BMF letters ). Ultimately, the introduction of Section 15b of the Income Tax Act in 2005 made the tax- saving models largely impossible.

Kick-back jurisprudence

The Federal Court of Justice has declared the case law on the so-called kick-back procedure also applicable to closed-end funds. According to this, the banks are obliged to disclose their own interests when selling closed-end funds. This arises from the fact that the banks charge an internal commission of 8 to 20% for brokering the offer of closed funds - e.g. B. the nominal value of the fund - on average. If the bank violates this disclosure obligation, the investor can assert claims for damages, insofar as he has suffered damage as a result. The limitation period for these claims begins at the end of the year in which the investor became aware that the bank has withheld its commissions from him. It lasts three years. This case law is also applicable to all closed funds, regardless of their legal form.

With a further ruling, the Federal Court of Justice has expanded its so-called kick-back case law. It is now the case that "if an investment services company violates its obligation to inform the customer about reimbursements, it bears the burden of demonstration and proof that it did not act willfully, even if its liability for negligent conduct according to Section 37a WpHG is statute-barred ”(continuation of BGHZ 170, 226).


Two subject-specific ombudsman offices in Germany offer arbitration for complaints in connection with closed funds:


Closed-end funds are criticized for fraud, poor investment results and lack of transparency. The Federal Association of Consumer Organizations calls for a general ban on the active distribution of closed funds to private investors, similar to what already exists in all EU countries except Germany, Austria and the Netherlands, a brokerage of only up to five percent of the free assets of a private investor and a clearly visible one Reference to the risk of total loss. The consumer advocates rely on estimates that 90 percent of closed-end funds did not achieve their goal and 50 to 70 percent made a loss over 20 years. In 2015, Stiftung Warentest came to the conclusion that only 6 percent of the closed-end funds were able to meet their forecasts in the past, while 69 percent of the funds even posted losses. Consumer advocates generally rate closed-end funds as unsuitable for 99 percent of investors because of the risk of total loss. A number of closed funds can also be found in a special list of dubious and risky financial products.

With the capital investment code that came into force on July 22, 2013 , closed-end funds were comprehensively regulated for the first time . The aforementioned demands by consumer advocates were only partially implemented.

Due to the previously barely existing regulation of the product, the market mainly attracted incompetent, dubious and sometimes even criminal actors. This meant that there were repeated capital losses for investors. Their need for legal advice led to a specialization on the legal side. But here too, dubious business practices by self-appointed so-called “investor protection lawyers” soon arose.

Other countries

United States

In the USA, closed-end funds are usually traded on recognized stock exchanges. The price per share is determined by supply and demand and usually differs from the net asset value of the underlying asset. In addition to mutual funds and unit investment trusts , closed-end funds are the third type of investment recognized by the SEC .

Great Britain

In Great Britain the form of the investment trust exists .


The listed investment company is known in Australia .

See also


  • Beatrix Boutonnet: Closed real estate funds. 4th edition. Deutscher Sparkassen-Verlag, Stuttgart 2004, ISBN 3-09-301425-5 .
  • Jochen Lüdicke, Jan-Holger Arndt: Closed funds. 6th edition. CH Beck, Munich 2013, ISBN 978-3-406-64007-0 .

Web links

Individual evidence

  1. BVI: KAGB
  2. [1]
  3. FTD: Fund as a tax-saving model ( Memento from September 29, 2007 in the Internet Archive )
  4. ^ Richard Haimann: Fund initiators hope for a comeback. In: Manager magazine. August 21, 2014, accessed May 29, 2019 .
  5. Building owner decree of the Federal Minister of Finance from 2003  ( page no longer available , search in web archivesInfo: The link was automatically marked as defective. Please check the link according to the instructions and then remove this notice.@1@ 2Template: Toter Link /  
  6. BGH, decision of January 20, 2009 , Az.XI ZR 510/07, full text.
  7. FTD of February 14, 2009: BGH snubs the financial sector ( Memento of September 7, 2012 in the web archive )
  8. ^ BGH, judgment of May 12, 2009 , Az.XI ZR 586/07, full text.
  9. ^ BGH, judgment of December 19, 2006 , Az. XI ZR 56/05, full text.
  10. Website ombudsman for closed funds e. V.
  11. Website ombudsman for investment funds
  12. Frederike Roser: Poor package insert . In: Der Tagesspiegel , May 22, 2013. Accessed March 7, 2014.
  13. Anno Fricke: Brief information on closed funds under criticism . In: Ärzte Zeitung , May 22, 2013. Accessed March 7, 2014.
  14. Heino Reents: Investors flee in droves from closed funds . In: Die Welt , July 13, 2013. Retrieved July 13, 2013.
  15. Philip Banse: Too little transparency in investments . Deutschlandfunk , May 21, 2013. Accessed March 7, 2014.
  16. ^ Stiftung Warentest: Closed funds: The bad balance of an industry , September 14, 2015. Accessed on January 12, 2016.
  17. ↑ Package inserts are not sufficient . In: Wirtschaftswoche , May 22, 2013. Accessed March 7, 2014.
  18. Stiftung Warentest: Warning list financial investments: Dubious companies and financial products , October 5, 2015, accessed on January 13, 2016.
  19. ^ Anne Seith: Invitation to rip off . In: Der Spiegel , No. 20/2013, May 13, 2013. Accessed March 7, 2014.