US credit managers are raising new interval funds which give retail investors access to alternative assets that can offer better returns than more traditional mutual fund holdings.
Managers including OppenheimerFunds in partnership with Carlyle Group, and Flat Rock Global have registered to raise interval funds in the last year, according to regulatory filings.
“There’s a trend towards interval funds as a new solution of bringing retail investors access to alternative strategies,” said Dustin Norris, head of distribution and chief product strategist at Highland Capital Management. “The interval fund wrapper allows for a much larger pool of illiquid investments with less concern about daily liquidity.”
The funds make a range of investments in Collateralized Loan Obligations (CLOs), Commercial Mortgage-Backed Securities (CMBS) and more traditional credit assets including leveraged loans and high-yield bonds…
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