Back to comparisons
Ch. 4
Investment Rules by Fund Regime
UCITS vs Part II vs SIF vs RAIF — diversification limits, leverage, asset eligibility
| Criterion | UCITS | Part II (TS) | Part II (Real Estate) | SIF | RAIF |
|---|---|---|---|---|---|
| Single Issuer Limit | 10% of NAV (5/10/40 rule) | 10% per issuer | 20% per property | ~30% principle (Circ. 07/309) | No hard limit — AIFM framework |
| Aggregate Cap | 40% for all >5% positions | None specified | None specified | None specified | None specified |
| Sovereign/Gov Exception | Up to 35% (100% with CSSF auth) | OECD derogation | N/A | OECD exception applies | Per AIFM policy |
| Deposit Concentration | Max 20% per credit institution | N/A | N/A | Principle-based | Per AIFM policy |
| OTC Derivative Counterparty | 10% (bank) / 5% (others) | N/A | N/A | Principle-based | Per AIFM policy |
| Borrowing Limit | 10% temp; 15% combined | 25% net assets | 50% of all property values | No hard limit | Per AIFM policy |
| Short Selling | Physical: no. Synthetic via derivatives: yes | Hedge-fund style: allowed with limits | Not applicable | Synthetic allowed within 30% logic | Per AIF strategy |
| Virtual Assets | Prohibited (CSSF confirmed) | Well-informed investor AIFs only | N/A | Allowed with governance requirements | Allowed if AIFM framework permits |
| Loan Origination | Not permitted | Hedge strategy variants possible | Not typically | Allowed | Allowed (LOAIF rules from Apr 2026) |
| EPM Techniques | Yes — securities lending/repos; strict collateral rules | Strategy-dependent | N/A | Allowed | Allowed |
| Eligible Assets List | Strict statutory list; 10% trash ratio | CSSF circular frameworks per strategy | Broad real estate definition | Any asset class — principle-based | Any AIF-eligible asset |
| Regulatory Framework | UCITS Dir. Art. 50–57; 2010 Law | IML 91/75 / CSSF 02/80 | 2010 Law Part II | CSSF Circular 07/309 | RAIF Law + AIFM mandate |
📌 Data sourced from Lux Investment Funds 2025, Chapters 4. Verify current requirements with CSSF at cssf.lu.