Types of Investment Funds in UAE

Updated on Thursday 20th July 2017

Types of Investment Funds in UAE Image

The United Arab Emirates (UAE) represents one of the most suitable locations for investment activities. Foreign businessmen interested in how to start a fund in the UAE may choose from numerous investment vehicles, designed to address the needs of various types of investors. Investment funds registered in the UAE can be registered as open-ended or closed-ended vehicles, each category offering different investment advantages

 

Main categories of UAE investment funds 

The regulatory framework applicable in UAE offers the following types of investment vehicles
mutual funds;
equity mutual funds;
fixed income mutual funds;
hybrid mutual funds;
exchange traded funds;
hedge funds
 

Mutual funds in the UAE

Mutual funds in the UAE are regulated under the Decision No. (9/R.M) of 2016 - Concerning the Regulations as to Mutual Funds, available for onshore investment funds. Mutual funds registered in this jurisdiction can be set up as open-ended or closed-ended vehicle, which refer to the rights investors have in issuing shares or bonds.
Investors interested in how to start a fund in UAE as a mutual fund may also register the vehicle in the Dubai International Financial Centre25 mutual funds were registered in UAE in 2016. 

 

Hedge funds in the UAE

Another type of investment fund that can be incorporated in this country is the hedge fund. Investors interested in how to start a hedge fund in the UAE are required to incorporate the legal entity following the regulations imposed by the Emirates Securities and Commodities Authority (ESCA). As mentioned above, the country also incorporates the Dubai International Financial Centre, an economic free zone in which investment funds, which may also include a hedge fund startup, are regulated by a different institution, the Dubai Financial Services Authority.  
Also, investors must know that regardless of the investment vehicle chosen for incorporation, the fund will need an approval issued by ESCA. Amongst the requirements, investors have to set up a capital of minimum AED 10 million. 
Foreign investors are invited to contact our team of affiliates in UAE for more details on this subject.