Get Ready For a Bitcoin Interval Fund: 2019Q2 Update
- Total interval fund net assets topped $29 billion in the most recent quarter.
- 73% of active funds reported increases in total net assets. Fastest growing funds included offerings from Silverbay, Griffin, Bluerock, and Versus Capital.
- Five new funds filed initial registration statements with the SEC during 2019Q2. One new fund went effective.
- The newly registered bitcoin interval fund is a groundbreaking development for both both 40 act funds and cryptocurrency.
Total interval fund net assets equaled $29.2 billion as of the end of 2019Q2, up 25% compared to the prior year, and up 7.4% compared to the prior quarter. Subsequent to the end of the quarter total net assets declined slightly to $29 billion, as the two of the (very large) Stone Ridge funds reported slight outflows.
Fastest Growing Interval Funds
Buoyant markets and inflows led to increased net assets across the board. 73% of active funds reported increases in net assets. The fastest growing interval funds include the following:
|Fund||Most Recent Reporting Period||Increase in Net Assets|
|ACAP Strategic Fund||March 31||$636,991,177|
|Griffin Institutional Access RE Fund||March 31||$380,229,804|
|Bluerock Total Income (plus) RE Fund||March 31||$283,041,535|
|Versus Cap Multi-Manager Real Estate Fund||March 31||$178,727,388|
|Versus Capital Real Asset s Fund||March 31||$115,817,926|
Fund Launch Pipeline
It was a busy quarter for interval fund registrations. Five new funds filed initial registration statements in 2019Q2.
|Fund Name||Registration Date||Strategy|
|Stone Ridge Residential Real Estate Income Fund I, Inc.||2019-06-21||Real Estate|
|Income EREIT Interval Fund||2019-06-04||Credit|
|A3 Alternative Income Fund||2019-06-04||Credit|
|Nuveen Municipal High Yield & Special Situations Fund||2019-05-23||Credit|
|Cipher Technologies Bitcoin Fund||2019-05-13||Bitcoin|
Subsequent to the end of the quarter, Hartford Schroders Opportunistic Income Fund also filed a registration statement. There are currently 25 funds in registration, pending the release of their final prospectuses, and SEC approval. Click here for a detailed list.
Based on the number of new fund registrations, it is likely 40 act structures such as interval funds and tender offer funds will become increasingly popular for alternative investment allocations. The following chart shows new initial fund registration trends since 2016(excludes follow on offerings). Click here for the list of funds included in this chart.
Bitcoin Interval Fund
Cipher Technologies Bitcoin Fund is the first cryptocurrency focused interval fund. It seems to have gone under the radar as major media outlets focused on bitcoin ETFs. The correspondence between the SEC and the fund is well worth reading. If this gets approved, it is groundbreaking both for the 40 act funds, and cryptocurrencies. Watch this space.
New Fund Launches
Principal Diversified Select Real Asset Fund went effective on June 25, 2019. It is raising $250 million via three share classes. It will invest in real assetss and real asset companies, including real estate, agriculture, infrastructure, energy natural resources, and timbers, etc. Data on how this Fund’s strategy and fee structure compares to its peers is available for Premium Members.
Research and Media Coverage
JD Supra Podcast on Interval Funds
Major Muni Junk Titan Starts to Capitalize on Defaults
The Hot New Thing in Funds Is Higher Fees and More Restrictions
Using an interval fund to add real estate to client portfolios
Vertical Capital: Steep Discount, But Complex History
Code and data used in this post can be found in our Github Repository.
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