CINCINNATI, OHIO – December 7, 2021 –Ultimus Fund Solutions® (Ultimus®), a leading independent, tech-enabled provider of full-service fund administration, accounting, and investor solutions is playing a significant role in an increasing number of launches and conversions of unlisted closed-end funds that include both interval funds and tender offer funds.
Interval funds continued to experience a surge in popularity and growth which is expected to accelerate. At the close of 2021Q3, aggregate net assets of all active public interval and tender offer funds were $44.8B, a 34% increase over the $33.5B reported at the close of 2020Q3 according to IntervalFundTracker.com1. As non-correlated investments with strategies that include credit, private equity and real estate, these funds have grown in popularity with institutional and retail investors as risk mitigators and portfolio diversifiers.
Partnering with asset managers to bring innovative new funds to market, Ultimus is playing key roles in an increasing number of interval and tender offer fund launches and conversions of other structures into unlisted closed-end funds. A central factor is a combination of Ultimus’ experience and depth of knowledge with these more complex fund structures in addition to our technology stack and processing tools which streamline sensitive transfer agent touchpoints such as enabling capital calls and tender offer processing, investor performance calculations, expense processing and more. Overall the firm helps to support fund managers’ efforts in areas such as initial product design, during fund launch or conversion, managing regulatory requirements, evaluating the distribution landscape, providing unique applications for advisers to understand their portfolio and shareholder activity, and helping to regiment the valuation environment.
To assist advisers considering the unlisted closed fund wrapper for new products, Ultimus collaborated with XAI Investments LLC (“XAI) on its recent whitepaper “Launching an Interval Fund: Clear-eyed approach critical to a successful launch.” The paper highlights ways successful firms have used to enter the market and offers best practices in structuring and seeding new products. XAI has a product structuring consulting practice and helps alternative managers with their go-to-market strategies for new closed-end funds. Kimberly Flynn CFA, Managing Director at XAI, stated “Ultimus provides a valuable perspective on strategies advisers can take to reach critical mass, with experience supporting a wide variety of asset classes in these structures.” According to Nick Darsch, Senior Vice President at Ultimus “In our experience, $100 million is a critical point for interval fund viability. We advise new interval fund sponsors to consider converting an existing private fund to an interval fund. Successful interval fund sponsors also join niche alternative investment communities to reach receptive advisers.”