Investments, tenth edition

  Other Investment Organizations 

 Some intermediaries are not formally organized or regulated as investment companies, but 

nevertheless serve similar functions. Three of the more important are commingled funds, 

real estate investment trusts, and hedge funds. 

  Commingled Funds 

  

Commingled funds are partnerships of investors that pool 

funds. The management firm that organizes the partnership, for example, a bank or insur-

ance company, manages the funds for a fee. Typical partners in a commingled fund might 

be trust or retirement accounts with portfolios much larger than those of most individual 

investors, but still too small to warrant managing on a separate basis. 

 Commingled funds are similar in form to open-end mutual funds. Instead of shares, 

though, the fund offers  units,  which are bought and sold at net asset value. A bank or insur-

ance company may offer an array of different commingled funds, for example, a money 

market fund, a bond fund, and a common stock fund.