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The increasing popularity of high yield bond funds brings the issue of liquidity mismatches to the forefront. There are plenty of opportunities in credit, but investors need to find the right vehicle for the right strategy. When the average high yield bond only trades nine times per week, a daily liquidity structure such as a […]
- Total Interval fund AUM has declined slightly in the most recent quarter, based on most recent SEC filings. Outflows were concentrated in a small group, and the majority of funds reported AUM growth.
- Losses and oversubscribed redemptions at reinsurance focused interval funds offset new fund launches. Additionally late 2018 equity market volatility also impacted some funds.
- Funds focused on lending and real estate continue to grow rapidly, both through asset price increases, and new investors.
- BlackRock, Cliffwater, Lord Abbett, and One William Street all launched new funds in 2019Q1.
- RiverNorth announced its plan to list its interval fund on NYSE. This is a positive development for the interval fund space.
Total interval fund net assets equaled $27.3 billion as of the most recent public filings, up 27.1% compared to the prior year, but down 0.8% compared to the prior quarter. In late 2018 and early 2019, new fund launches were offset by stock market volatility, and redemptions at funds focused on reinsurance and insurance linked securities.
In the most recent quarter, 34 active interval funds reported net asset increases, and 20 reported net asset declines. Additionally, 11 funds recently launched and have not yet filed their first financial statements. Click here for current AUM data on all 64 active interval funds. Premium members also have access to historical AUM data
Fastest Growing Interval Funds
The following list shows the five fastest growing interval funds, based on net asset growth in the most recent reported quarter:
Tender offer and interval funds have become the structure of choice for alternative asset managers. Nonetheless, a small group of REITs and BDCS continues to raise capital and play an important role in investor’s portfolios.
(Note: this chart includes only new funds registering shares for the first time, and excludes follow-on offerings. Additionally, funds that offer multiple share classes via a master feeder structure are treated as a single fund)
Fundraising in NT REITs and BDCs has mainly consisted of a small group of legacy funds, rather than newly launched funds. Non-Traded REIT fundraising has been dominated by Blackstone, which as over 50% market share. Many legacy non-traded REITs and BDCs have also continued to raise capital through follow on offerings. Yet new fund’s have been few and far between. In contrast, more and more asset managers are launching tender offer and interval funds. As more financial advisers and asset allocators get comfortable with these structures, the trend is likely to continue.
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Premium Members of Interval Fund Tracker can now access a full list of Tender Offer Funds, Interval Funds, Non-Traded REITs and BDCs registrations since 2016.
- Interval fund net assets increased 41% in 2018, reaching $27.5 billion.
- A record number of new funds launched in 2018.
- Interval fund performance has been generally positive for funds with track records.
- The government shutdown is temporarily delaying SEC review of pending interval fund registration statements.
Asset Growth and Fund Launches
Total net assets in interval funds increased 41% in 2018, reaching approximately $27.5 billion based on filings available at the end of the year. The SEC declared effective 16 interval fund registrations statements in 2018, including three in Q4. Additionally, two privately offered interval funds launched in 2018. Overall 2018 was another year of historic growth for interval funds.
Although there are 60 active funds, the five largest alone account for 65% of total net assets. Many funds recently launched and are yet to gain fundraising momentum. Click here for AUM data on active interval funds.
Note All data in this post is based on SEC filings available as of January 1, 2019 unless otherwise indicated. To access data and code behind this article, see Interval Fund Tracker’s Bitbucket repository.
Fastest Growing Interval Funds
Thirty-five active interval funds reported net asset growth in the most recent quarter, and fifteen reported a decrease. In general, large asset managers continue to dominate fundraising. The following list shows the five fastest growing interval funds, based on net asset growth in the most recent reported quarter