What is a fund? This question may be simple, but it is
important to alternative investments because a fund (collective
investment scheme) faces a much higher level of regulation than an
arrangement that it is not a fund.
Historically, the way in which many alternative investments have
operated is by giving investors an identifiable share of the
property of the scheme, which each investor has the ability to
exercise some form of day-to-day control over. This has generally
meant that those types of investments were not believed to be
classed as funds for regulatory purposes.
However, a recent English case has moved the goal posts on what
constitutes a fund, which may have a profound impact on the
alternative investment market, including more novel financial
services, such as peer-to-peer lenders.
