What is a Crossover Fund?
A crossover fund is a mutual fund that invests both in public stocks and private equity. Private equity is an investment in which the holder of the equity has an ownership stake in the company. Private equities are not publicly traded on the open stock market. A crossover fund offers one distinct advantage to investors holding mutual funds. It is a high yield mechanism. While most mutual funds are designed to build a steady return over time, a crossover fund can build a much quicker return on investment. However, as with any type of investing, a crossover fund has tradeoffs, the major one being there is higher risk involved. While a crossover fund can provide a greater return on investment, is can also lose money easier than other types of mutual funds. Due to the high risk, this type of fund is not recommended for some investors, especially those nearing retirement age. This may be a good fund to have in the first few years of an investor’s working career, as it offers a chance to bui
