Interval Funds: A Primer
12 March 2026
Read Time 3 MIN
Interval Fund Structure Vs. Other Vehicles
| Feature | Interval Fund | Tender Offer Fund | Mutual Fund | ETF | Listed Closed-End Fund |
| Trading | Direct with fund | Direct with fund | Direct with fund | Exchange | Exchange |
| Pricing | NAV | NAV | NAV | Market price | Market price |
| Redemption | Required periodic repurchases (typically 5% of shares outstanding quarterly) | Periodic repurchases at Fund’s discretion (typically quarterly) | Daily | Daily | None (sell on exchange) |
| Liquidity | Periodic | Discretionary | Daily | Intraday | Intraday |
| Premium/Discount | No | No | No | Possible | Common |
| Liquidity | Typical (up to 33.3 1/3% with debt; 50% with preferred stock) | Typical (up to 33.3 1/3% with debt; 50% with preferred stock) | Not typical (up to 33.3 1/3% with debt) | Not typical (up to 33.3 1/3% with debt) | Typical (up to 33.3 1/3% with debt; 50% with preferred stock) |
How to Purchase Shares
Investing in an interval fund is straightforward and similar to purchasing shares of a mutual fund:
Through a Financial Advisor:
Most interval funds are distributed through broker-dealers and registered investment advisors, who facilitate the purchase and manage the subscription process.
Directly with the Fund:
Eligible investors may purchase shares directly through the fund’s transfer agent by completing a subscription agreement.
Custodial Platforms:
Many interval funds are available on major custodial platforms (e.g., Schwab, Fidelity, Pershing, etc.), allowing seamless integration with existing brokerage accounts.
Pricing:
Shares are purchased at the next calculated NAV after an order is received. Most funds calculate NAV daily.
How to Redeem Shares
Interval funds offer liquidity through periodic repurchase offers:
Step 1 - Notification:
The fund announces the repurchase offer, specifying the percentage of shares offered (typically 5%), the request deadline, and the repurchase pricing date.
Step 2 - Submit Request:
Shareholders submit a repurchase request through their broker, advisor, or directly to the fund's transfer agent before the deadline.
Step 3 - Pro-Rata Allocation:
If total requests exceed the offer amount, requests are fulfilled on a pro-rata basis. For example, if the fund offers to repurchase 5% of shares but receives requests for 10%, each investor receives 50% of their requested amount.
Step 4 - Receive Proceeds:
Proceeds are typically paid within 7 days after the repurchase pricing date, either by check or direct deposit to your account.
Redemption Timing Explained
Understanding the redemption timeline is critical for liquidity planning:
| Timeline | Event |
| Day 1 | Fund announces repurchase offer (notification sent to shareholders) |
| Days 1-21 | Offer window open - shareholders may submit repurchase requests (minimum 21 days) |
| Day 21 | Request Deadline - all repurchase requests must be received |
| Days 21-35 | Repurchase Pricing Date - NAV calculated (within 14 days of deadline) |
| Days 28-42 | Payment - proceeds distributed (within 7 days of pricing date) |
Advantages and Risks of Interval Funds
| Advantages | Risks |
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Who Should Invest in Interval Funds?
Interval funds may be appropriate for investors who:
- Seek exposure to alternative investments without private fund complexity
- Have longer investment horizons and can accept limited liquidity
- Want potential yield enhancement or diversification benefits
- Prefer NAV-based pricing over exchange-traded price volatility
- Value 1940 Act protections and transparent reporting
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