Access to private fund strategies has long been limited to institutions and high-net-worth investors. This is starting to change. Interval and tender offer funds provide individual investors with access to strategies once restricted by regulation, high minimum investments, and structural complexity.
These hybrid vehicles are gaining traction by offering entry to private credit, real estate, and venture capital within a regulated and transparent framework. Interval and tender offer funds tend to be more transparent and accessible than traditional private equity or hedge funds.
Bringing private strategies to a broader audience
The real shift is about access. Investors who were once excluded from alternative strategies due to minimum thresholds or accreditation rules can now consider options that provide similar exposures in a more accessible format.
Interval funds allow investors to buy shares daily, while redemptions occur on a fixed schedule. Tender offer funds, by contrast, repurchase shares at the board’s/fund’s discretion, often on a quarterly basis. This approach does not offer full liquidity but provides a predictable and manageable way for investors to exit.
For managers, the ability to work with a broader investor base without the daily redemption pressures typical of registered open-ended funds is a key strength. These structures enable a focus on long-term returns and reduce the need to hold large cash buffers for daily dealing.
Why these funds are growing in popularity
Both fund types are attracting strong inflows. The expansion of private credit has played a major role, as managers seek capital for strategies requiring patient investment. These vehicles make it possible to hold fewer liquid assets while still offering liquidity that suits many individual investors.
This growth has not gone unnoticed. Fund launches have increased, and the combined assets under management across interval and tender offer funds have risen significantly in recent years. Investors want yield, diversification, and clearer access to alternative markets. These funds provide that pathway.
A practical option for retail and institutional investors
While not suited to every investor, interval and tender offer funds offer clear benefits for those who do not need daily liquidity. They tend to be less volatile than public equities since valuations reflect underlying assets rather than market sentiment. They also suit a long-term investment mindset focused on total return rather than short-term price movements.
From a manager’s perspective, these funds provide more control over inflows and outflows, enabling improved portfolio construction and closer alignment with investment objectives.
|
Feature |
Interval fund |
Tender offer fund |
|
Investor focus |
|
|
|
Fund structure |
|
|
|
Redemptions |
|
|
|
Liquidity requirements |
|
|
|
Investor eligibility |
|
|
Getting it right requires specialist knowledge
Establishing and running an interval or tender offer fund involves more than regulatory filings and fund setup. Managers must consider valuation methodologies, investor communications, NAV timing, reporting, and operational resilience. These are not off-the-shelf funds, and the complexity beneath the surface requires a considered, specialist approach.
Interval and tender offer funds are one of the only ways that retail investors can access private markets through a registered fund. They combine liquidity, transparency, and exposure to alternative strategies, providing access to opportunities that were previously out of reach for many.
