When you invest in a private equity fund, you are investing in a fund managed by a private equity firm—the adviser.  Similar to a mutual fund or hedge fund, a private equity fund is a pooled investment vehicle where the adviser pools together the money invested in the fund by all the investors and uses that money to make investments on behalf of the fund.  Unlike mutual funds or hedge funds, however, private equity firms often focus on long-term investment opportunities in assets that take time to sell with an investment time horizon typically of 10 or more years. 

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A typical investment strategy undertaken by private equity funds is to take a controlling interest in an operating company or business—the portfolio company—and engage actively in the management and direction of the company or business in order to increase its value.  Other private equity funds may specialize in making minority investments in fast-growing companies or startups.   

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Although a private equity fund may be advised by an adviser that is registered with the SEC, private equity funds themselves are not registered with the SEC.  As a result, private equity funds are not subject to regular public disclosure requirements. 

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