Unlisted closed-end funds (CEFs) are gaining in popularity with increases in both the number of funds available to investors and the value of assets under management (AUM), according to a new survey by UMB Fund Services in partnership with FUSE Research Network.
The survey reveals that as of the first quarter 2017, there were 109 unlisted CEFs available for purchase by investors regardless of accreditation status, with total assets under management (AUM) of approximately USD41.7 billion.
Forty per cent of the assets under management belong to the five largest funds in the space, while the size of the unlisted CEF market has grown steadily since 2014 with assets increasing at a six percent compound annual growth rate from 2014 to Q1 2017.
“While unlisted closed-end funds are not a new concept in the registered marketplace, they have gained steady interest in recent years as a viable option to support the growing demand for non-correlated returns,” says Tony Fischer (pictured), president of UMB Fund Services. “We have been servicing funds in this space for nearly 20 years, but there has not been comprehensive research on these products until now. We are excited to offer this research to help inform not only our current clients, but also other managers looking at product development opportunities.
“This data validates the increasing momentum we have been seeing specifically around interval funds. I believe this is the first published research that has gone to this depth in order to confirm the record growth in these products.”