According to Section 1 of the German Capital Investment Code (KAGB), an investment fund is an undertaking for collective investment that pools capital from multiple investors in order to invest it in accordance with a defined investment strategy for the benefit of those investors. It is not an operating company outside the financial sector.

The term “investment fund” is an umbrella term that encompasses both undertakings for collective investment in transferable securities (UCITS) and alternative investment funds (AIFs). Colloquially, investment funds are often referred to as “funds.”

An investment fund raises capital from a large number of investors. This capital is invested by an asset management company (KVG) in assets, such as tangible assets like solar power plants. In doing so, the KVG decides whether to buy, sell, or hold these assets in accordance with the guidelines set forth in the fund documentation. A custodian independently verifies that the issuance and redemption of shares, the valuation of the investment fund, and the use of returns are carried out properly. It also monitors cash flows.

The KVG and the custodian are subject to supervision by the Federal Financial Supervisory Authority (BaFin). This ensures that comprehensive control mechanisms are in place to protect investors. Nevertheless, every investment involves risks—there is no guarantee that the investment objectives will be achieved. Information on this can be found in the respective sales documents.

An investment fund is a financial instrument that pools capital from many investors and invests it in various assets, such as stocks, bonds, or tangible assets like solar power systems. An asset management company is responsible for managing the fund’s assets.

Investors contribute their capital and participate in the fund’s performance as well as in its potential returns. There are different types of funds, such as open-end and closed-end funds, which may differ in their investment strategies and structures.

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Alternative Investment Funds (AIFs) refer to all investment funds that are not Undertakings for Collective Investment in Transferable Securities (UCITS). UCITS are investment funds that meet the requirements of Directive 2009/65/EC of the European Parliament and of the Council of July 13, 2009, on the coordination of laws, regulations, and administrative provisions relating to certain undertakings for collective investment in transferable securities. Closed-end AIFs are also referred to as “closed-end funds.” HEP Kapitalverwaltung AG specializes in launching closed-end AIFs that, as “solar funds,” focus their investments on solar energy. In general, investments in closed-end solar funds may offer high potential returns but also entail significant risks.

In the case of closed-end AIFs, ordinary redemption of shares before the end of the term is not permitted. Investors therefore acquire their shares for a predetermined term, which—depending on the terms of the fund documentation—may be extended or shortened.

For open-ended AIFs, the ordinary redemption of shares is possible. Depending on the fund documentation, redemption may occur on each valuation day or only on specific settlement dates. Furthermore, notice and redemption periods may be agreed upon. Most open-ended AIFs are established for an indefinite term, i.e., without a fixed term.

Both public and special AIFs may be structured as open-ended or closed-end investment funds.

In special AIFs, only semi-professional investors as defined in Section 1(19)(33) of the KAGB and professional investors as defined in Section 1( 19 No. 32 of the KAGB, while retail investors as defined in Section 1 (19) No. 31 of the KAGB may also invest in public AIFs. Furthermore, there is flexibility in structuring the fund documentation for specialized AIFs.

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A solar fund is an investment fund that focuses on infrastructure (photovoltaics/solar energy). Accordingly, the fund’s assets consist primarily of solar power plants, which—depending on the terms of the fund’s documentation—may be at various stages of development, meaning that, for example, project rights or solar projects could also be acquired. The assets may be acquired directly or indirectly through special-purpose entities or target funds (i.e., investment funds in which the fund itself invests). Different target countries (e.g., Europe, Canada, Japan, the U.S.) may be specified for the location of these special-purpose entities or the solar power plants. Accordingly, both domestic and global investment opportunities may be considered. The goal is to generate sustainable return opportunities while simultaneously promoting the expansion of solar energy to drive the transition away from fossil fuels.

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The public and specialized AIFs managed and initiated by HEP Kapitalverwaltung AG focus on infrastructure (photovoltaics/solar energy) and are therefore of interest to investors who are committed to promoting renewable energy in the context of a future-oriented energy supply and climate protection.

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Investment opportunities and terms vary depending on the financial product. Detailed information about our solar funds, which are currently being offered, is available on the corresponding fund overview page on our website.

If you have any questions or would like to speak with someone in person, HEP Vertrieb GmbH is available to assist you within our hep solar group. The sales team will answer your specific questions about investment opportunities and our solar funds and will also be happy to assist you with any other concerns. You can find the specific contact persons on our Contact Page.