Multi-manager investment is an investment product that consists of multiple specialized funds. Each specialized fund may invest across different sectors and markets, or having managers investing in the same asset class but have different investment styles. For example, large cap value fund versus large cap growth fund.

This theory is founded on the premise that not all investment managers are good in all markets and that not all managers are successful at all times. Spreading the investment money across different asset classes or markets allows the investor to achieve the necessary diversification

Diversification (finance)

In finance, diversification means reducing risk by investing in a variety of assets. If the asset values do not move up and down in perfect synchrony, a diversified portfolio will have less risk than the weighted average risk of its constituent assets, and often less risk than the least risky of...

, reducing risk without sacrificing the return.

See also

• Fund of funds
  Fund of funds
  A "fund of funds" is an investment strategy of holding a portfolio of other investment funds rather than investing directly in shares, bonds or other securities. This type of investing is often referred to as multi-manager investment...
  
  
• Manager of managers fund
  Manager of managers fund
  A "manager of managers fund" is an investment fund that uses an investment strategy of directly selecting different investment managers and gives them mandate to make investment decisions. This is different from the traditional mutual fund where only one manager invests the fund capital in stock,...
  
  
• Investment management
  Investment management
  Investment management is the professional management of various securities and assets in order to meet specified investment goals for the benefit of the investors...