Fund Operations

Side Pocket

Definition

What is Side Pocket?

A separate account used to isolate illiquid or hard-to-value assets from a fund's liquid portfolio.

Example in practice

A defaulted bond is moved into a side pocket pending recovery.

Keep learning

The deadline by which a valid fund instruction must be received for a particular dealing day.

The specified time at which a fund values its assets and calculates dealing prices.

A fund-pricing method under which orders receive a price calculated after the instruction is accepted.

A debt security through which an investor lends money to an issuer in return for promised payments.

Think you know your investing terms?

Put your knowledge to the test with a quick quiz.