Bell Rock glossary
Side Pocket
A separate designation within a fund holding illiquid or hard-to-value assets, ring-fenced from ordinary subscriptions and redemptions.
A side pocket is a mechanism by which a fund segregates illiquid or hard-to-value investments from its main portfolio, so that they are not subject to ordinary subscription and redemption activity until realised. Side pockets protect incoming and outgoing investors from mispricing of illiquid positions, but require clear disclosure in the offering document and careful governance, as they affect liquidity, fees and valuation.
Related guidance
Limited Partnership Agreement · Limited Partner
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