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The Trendiest Investment on Wall Street…That Nobody Knows About

November 8, 2016

The Trendiest Investment on Wall Street…That Nobody Knows About

PHOTO: CHRISTOPHE VORLET

Among this year’s hottest investment ideas is one that even many of the people buying it have never heard of.

This peculiar vehicle is called an interval fund, and asset managers are using it to offer portfolios they might not be able to market otherwise. While such funds come with an admirable focus on holding assets for the long term, they also lock money up in ways many investors aren’t accustomed to.

In the first three quarters of this year, asset managers registered to sell $26.7 billion of interval funds, up 24% from the same period in 2015, estimates Robert A. Stanger & Co., a firm in Shrewsbury, N.J., that tracks non-traded securities.

Among them are funds that hold commercial real estate, timberland and farmland, online consumer loans, the debt of distressed or bankrupt companies, “catastrophe bonds” that are tied to risks like hurricanes or earthquakes, and other illiquid positions that seldom trade in the financial markets.

Unlike a conventional mutual fund, an interval fund is ideal for such assets, since purchasers can’t sell their shares back at will. Instead, an interval fund will cash you out only a few times a year — most often, quarterly.

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ad_460x200bv_ifcef_fghBlue Vault’s Interval Fund and Nontraded CEF Review covers both interval funds and nontraded closed-end funds (CEFs). Strategies of these funds can range from real estate to hedge funds, so research on investment strategy is very important for this diverse set of alternative investments. The research covers key performance metrics, investment strategies and the associated investment managers.

The first IF and CEF Review will be available this November. Click here for more details.

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Loreen M. Gilbert, CIMA, AIF, CRC, CLTC – President, WealthWise Financial Services
Blue Vault
July 6, 2016

Our firm has been using Blue Vault from the first year it was available.

We have found it to be a valuable tool to verify what wholesalers tell us and to dig deep into how the reported investments are really performing.

We appreciate that Blue Vault has expanded its services from initially covering REIT's to now also including BDC's.

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