A fund of hedge funds is an investment vehicle whose portfolio consists of shares in a number of hedge funds. The fund of funds strategy can be applied to any type of investment fund, from a mutual fund to a private equity fund. Diversification benefits are gained through FOF.
Thematic or Theme Based Fund
Thematic funds are funds that invest in stocks tied to a theme. These funds are more broad-based then sectoral fund, as they pick companies and sectors united by an idea. For instance, an infrastructure theme fund will invest in cement, power, steel, among other sectors.