There are currently more than 70 active interval funds, with a combined total net assets of approximately $35 billion. The increasing popularity of the interval fund structure has attracted new sponsors to the space. Several asset managers with active funds have launched additional products.
Seven new interval funds have filed registration statements since the beginning of 2021. A complete list of all 34 interval funds currently in registration pending SEC approval is available here. The following table summarizes interval funds that have filed registration statements so far in 2021.
|Fund Name||Registration Date||Strategy|
|Lord Abbett Special Situations Income Fund||4/16/2021||Credit|
|Thirdline Real Estate Income Fund||4/13/2021||Real Estate|
|BNY Mellon Alcentra Opportunistic Global Credit Income Fund||4/1/2021||Credit|
|PIMCO Flexible Emerging Markets Income Fund||3/22/2021||Credit|
|Calamos Hunt Alternative Income Fund||2/19/2021||Credit|
|Finite Solar Fund||2/10/2021||Other|
|AFA Multi-Manager Credit Fund||2/4/2021||Credit|
|Cliffwater Enhanced Lending Fund||1/29/2021||Credit|
Let’s take a closer look at each of these recently registered funds.
Lord Abbett Special Situations Income Fund
Lord Abbett Special Situations Income Fund is pursuing income and capital appreciation. It has a flexible strategy that allows it to allocate a cross a broad range of asset classes and sectors at every level of the capital structure across developed and emerging markets, in stressed securities and special situations. Examples of special situations mentioned in the draft registration statement include complex, dislocated and distressed conditions such as mergers and acquisitions, spin-offs, litigation, bankruptcy, proceedings and workouts, financial restructurings, new products or management changes.
This is Lord Abbett’s third interval fund launch. Lord Abbett also manages the Lord Abbett Credit Opportunities Fund, which has $362 million in net assets, and the Lord Abbett Floating Rate High Income Fund launched in September 2020, but has not yet reported any assets.
Thirdline Real Estate Income Fund
Thirdline Real Estate Income Fund’s investment objective is to generate current income with low volatility and low correlation to broader equity and bond markets. According to Thirdline’s draft registration statement, the fund will invest at least 80% of its assets in real estate investments, which may include, common stock, partnership, or similar interests, preferred stock, secured or unsecured debt issued by private real estate funds, non-traded REITS, publicly traded REITs, and other investment vehicles. It may also invest directly in private commercial real estate investments.
BNY Mellon Alcentra Opportunistic Global Credit Income Fund
BNY Mellon Alcentra Opportunistic Global Credit Fund is seeking to provide total return consisting of high current income and capital appreciation. According to the draft registration statement, the fund will pursue a credit strategy involving several types of credit instruments including: Senior Secured Loans, Direct Lending and Subordinated Loans, Special Situations, Structured Credit; and Corporate Debt
BNY Mellon also operates the BNY Mellon Alcentra Global Multi-Strategy Credit Fund, Inc., a tender offer fund with $263 million in net assets.
PIMCO Flexible Emerging Markets Income Fund
The PIMCO Flexible Emerging Markets Income Fund seeks to provide attractive risk-adjusted returns and current income. According to the draft registration statement, the investment strategy covers a wide range of credit instruments from sovereign, quasi sovereign, and corporate borrowers that are economically tied to emerging market countries.
PIMCO also manages two other credit focused interval funds, including the PIMCO Flexible Credit Income, which has $1.6 billion in net assets, and the PIMCO Flexible Municipal Income Fund, which has $500 million in net assets.
Finite Solar Fund
The Finite Solar Fund’s investment objective is to provide total return with an emphasis on current income. This will invest in credit instruments and securities related to the solar industry. According to the draft prospectus, the fund will primarily be invested in solar assets that are expected to generate interest or payment streams from consumers and commercial entities that have elected to finance the development, purchase or installation of solar energy systems.
AFA Multi-Manager Credit Fund
The AFA Multi-Manager Credit Fund’s primary investment objective is to provide a high level of current income, with capital appreciation as a secondary objective. AFA Multi-Manager Credit Fund invest in a wide range of private and public credit securities and credit related instruments. According to the draft prospectus, it will operate as a fund of funds, allocating to underlying funds selected through its market screening and in depth due diligence process.
Cliffwater Enhanced Lending Fund
Cliffwater Enhanced Lending Fund’s objective is to seek high current income and modest capital appreciation. It will focus on the private debt sector, including direct lending, secured and unsecured bonds and loans with fixed and floating coupons.
Cliffwater also manages the Cliffwater Corporate Lending Fund, which has $744 million in net assets.
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