Glossary · Fund Structures
Segregated Portfolio Company (SPC)
A segregated portfolio company (SPC) is a single legal entity whose assets and liabilities are divided into statutorily separated portfolios.
A segregated portfolio company is available in several offshore jurisdictions, notably the Cayman Islands. Each segregated portfolio has its own assets, liabilities and investors, and the law ring-fences them so that creditors of one portfolio cannot claim against the assets of another. Portfolios are not usually separate legal entities, however; the SPC contracts on behalf of each portfolio.
SPCs are used for platforms that host several strategies or managers under one umbrella, for multi-strategy offerings, and for funds that want separate portfolios for different investor groups while sharing one board and set of service providers. This can reduce set-up and ongoing costs compared with launching separate companies.
Operationally, every contract, bank account and trade must be clearly attributed to the correct portfolio, since mistakes can undermine segregation. Each portfolio needs its own books, NAV, reconciliations and often its own audit opinion. Allocation of shared expenses must follow the offering documents.
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