A depositary is an institution appointed to hold a fund's assets, or to record and verify ownership of those that cannot be physically held, and to oversee certain actions of the fund manager.
What it does
The depositary keeps custody of financial instruments and checks ownership of other assets, such as property. It monitors cash flows, and it verifies that issuing and redeeming units and calculating the unit value follow the law and the fund rules. It acts separately from the manager.
Why it matters
The depositary provides independent control, which reduces the chance that assets are misused. It does not protect you from investment losses. When checking a fund, find the name of its depositary in the prospectus and confirm that it is a real, authorised institution.
General information. Not investment advice or a suitability assessment.
