A fund created to invest in private equity funds. Typically, individual investors and relatively small institutional investors participate in a fund-of-funds to minimize their portfolio management efforts.

An investment vehicle, traditionally offered by consulting firms (with SEC registration) in which the investors' money is distributed among portfolios managed by different managers. The idea is to offer the investor greater diversification and thus reduced risk.

A private equity fund in which the capital of Limited Partner investors is pooled to participate in a variety of private partnerships, each with different General Partners, investment strategies and styles. Major benefits of this approach are diversification and access to funds.