👉 Fund engineering is the process of designing, structuring, and optimizing financial instruments to meet specific investment objectives while managing risk and regulatory constraints. It involves creating customized securities, such as derivatives, structured products, or hybrid instruments, that can be tailored to achieve desired outcomes like enhanced returns, improved risk-adjusted performance, or better liquidity. By manipulating factors like cash flows, underlying asset exposure, and payment schedules, fund engineers aim to align the structure of these instruments with the preferences of investors, whether they seek income generation, capital appreciation, or protection against market volatility. This practice requires deep expertise in financial modeling, derivatives pricing, and regulatory frameworks to ensure the engineered products are both effective and compliant.
