What does the individual fund accounting method in a UITF entail?

The individual fund accounting method in a UITF involves accounting for each participant's investment separately. This method ensures that each investor's contributions, withdrawals, and overall performance are tracked distinctly, allowing for accurate reporting and transparency of each investor's share in the fund. By doing this, participants can see how their specific investment is performing relative to the overall fund and make informed decisions based on their individual holdings.

In contrast to pooling all participants’ investments into a single account, which would obscure individual performance details, or using a general ledger for all fund transactions, which may simplify bookkeeping but lacks granularity regarding individual investments, the individual fund accounting method emphasizes tailored accounting practices. Additionally, calculating performance based on the overall fund does not provide the necessary details about each participant's unique investment journey within the UITF.