Collective Investment Fund (CIF) is a fund that is operated by a trust company or a bank and handles a pooled group of trust accounts. CIFs combine the assets of various individuals and organizations to create a larger, well-diversified collection. CIFs is also known as Master Trust Accounting. For example, a fund of grouped assets pooled by pension, profit sharing and retirement that are exempted from federal income tax. National banks and most of the state chartered banks are authorized to invest trust assets in a master trust account. CIFs are exempt from SEC registration and reporting requirements
Benefits enjoyed by investor’s of CIFs are:
- diversification of investments;
- improved earnings; and
- economies of scale.