the investment fund receive money from the population, and from corporations that it has purchased shares of. The cash on hand pays interest to the population, supplementing their income. Effectively giving you the advantage of higher salaries, w/o the drawbacks.
The bottom line, is that it increases your country income. However, it takes a significant amount of effort to make any real difference. Personally, to me, it is worth the time and effort. I have several countries that have over 100T cash in the IFs.
Central Orbital, my main on LU
Cash Private Investments Funds 116,904.69B SC$
New Contributions by the Population 4,229.52M SC$
Profit from Private Investments this Month (Interest) 48,710.29M SC$
Dividend ... 1,909.26M SC$
Number of Workers 36,699,527
Profit per Worker 1,274.00
Current Market Interest Rate 0.50%
Thats actually my third largest IF. The easy way to determin the effect... the 48B interest payed, works out to being about 24B higher country profit per game month. Give or take a bit.