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Globe and Mail
14 hours ago
- Business
- Globe and Mail
XA Investments Reports Record $227 billion in Managed Assets in its Second Quarter 2025 Market Update
CHICAGO, July 22, 2025 (GLOBE NEWSWIRE) -- XA Investments LLC ('XAI'), an alternative investment management and consulting firm, announced today that its Non-Listed Closed-End Funds Second Quarter 2025 Market Update shows accelerated growth in the market, a surge in fund launches, and a shift toward greater investor accessibility. 'The non-listed CEF market continues to show record growth with 17% or 50 funds in the market reaching over $1 billion in assets under management and seven of those funds hitting the $1 billion milestone this quarter' stated Kimberly Flynn, the president of XAI. 'As more assets continue to flow into the interval / tender offer fund market, we believe the market's trajectory will remain positive, with significant opportunities for expansion throughout the rest of the year,' she added. The market update is a comprehensive research report detailing current market trends and industry highlights. The non-listed closed-end fund (CEF) market includes all interval and tender offer funds. The report highlights the removal of accredited investor suitability restrictions, divergence of positioning in the market, dominance of interval funds with a daily NAV and no suitability restrictions, increased performance coverage, and coverage of Specialty Structures. The non-listed CEF market reached a new peak with 288 interval and tender offer funds with a total of $196 billion in net assets and $227 billion in total managed assets, inclusive of leverage, as of June 30, 2025. The market includes 144 interval funds which comprise 59% of the total managed assets at $132.8 billion and 144 tender offer funds which comprise the other 41% with $93.9 billion in total managed assets. This is a significant change from previous quarters, as the number of interval funds has caught up to the total number of tender funds. In Q2 2025, 23 new funds entered the market, representing an increase of 13 funds compared to the 10 funds launched in Q2 2024. Market-wide net assets increased $15 billion in Q2 2025 from the prior quarter. In total, there are 150 unique fund sponsors in the interval and tender offer fund space, with 54 fund sponsors that have two or more interval and/or tender offer funds currently in the market. Additionally, there are 22 funds currently in the Securities and Exchange Commission registration process from fund sponsors looking to launch another fund. Displaying the growth of new funds in the market, the market share of the top 20 funds continues to decrease, falling to 59% in Q2 2025 from 60% in Q1 2025 and 65% in Q4 2024. Among the new funds launched in Q2 2025, there were nine new interval fund sponsors, including Corient, Coatue, and Select Equity Group. XAI also noted the emergence of Specialty Structures within the market. These funds are continuously offered, evergreen, semi-liquid private funds designed for accredited investors and qualified purchasers. They are exempt from the Investment Company Act of 1940 but still governed by federal securities laws. These evergreen funds provide access to alternative strategies while offering limited liquidity and reduced reporting obligations for the manager compared to registered funds. The current landscape of 13 Specialty Structures funds is dominated by large private equity firms including Blackstone, KKR, and Apollo. While Specialty Structures and interval / tender offer funds have some similarities, the fund structures differ in how they handle liquidity, investor eligibility, reporting obligations, and tax treatment. 'Understanding Specialty Structures helps managers better align product design with strategy and audience, which is increasingly critical in a growing and competitive market' Flynn said. In this quarterly report, XAI covers the Q1 2025 net flows which are lagged by reporting cycles. In Q1 2025 funds had positive net flows, totaling over $13 billion, with 67% of funds reporting positive net flows. The majority of net flows in Q1 2025 went into daily NAV funds without suitability restrictions, attracting 58% of marketwide net flows. Two-thirds or 67% of net flows went into funds with no suitability restrictions, while 12% went into funds limited to accredited investors, and 21% went into funds limited to qualified clients. In aggregate, the top 20 largest interval/tender offer funds accounted for 50% of total net flows including many of the market leaders such as the Cliffwater Corporate Lending Fund, Partners Group Private Equity (Master Fund), LLC, and ACAP Strategic Fund. 'The non-listed CEF market continues to grow with a total of 51 funds in the SEC registration process at the end of the first quarter,' Flynn noted. 'While the SEC backlog decreased by seven funds from the end of Q1 2025 to the end of Q2 2025, we believe there will still be significant growth in the market this year. So far in 2025, there have been 46 new SEC filings, compared to 27 new filings from this point in 2024, representing a 70% increase in registrations' she added. Newly launched non-listed CEFs spent around six months in the SEC registration process, with the fund's asset class continuing to be the main driver of time spent in the SEC review process. Tax-Free Bond funds were the quickest to launch, at 150 days on average spent in registration. At 53%, the majority of interval and tender offer funds do not have any suitability restrictions for investors imposed at the fund level — 27% of funds are available to accredited investors and 20% are only available to qualified clients. The amount of funds offered with no suitability restrictions is also predicted to increase with recent changes in a SEC Staff position. Following this change in position, many interval and tender offer funds have filed prospectus supplements removing accredited investor requirements. According to Flynn, 'We expect more funds to reduce their suitability requirements in the near future and for many new funds to forgo accredited investor requirements.' Alternative funds without suitability restrictions also prove to be more accessible and have gathered more assets at $130.5 billion in managed assets or 57% of market-wide assets. For more information on the interval fund market and to read our full quarterly report on non-listed CEFs, please visit the CEF Market research page linked here and click 'Subscribe' for access to XA Investments' online research portal and pricing information. In addition, please contact info@ or 888-903-3358 with questions. About XA Investments XA Investments LLC ('XAI') is a Chicago-based firm founded by XMS Capital Partners in 2016. XAI serves as the investment adviser for two listed closed-end funds and an interval closed-end fund, respectively the XAI Octagon Floating Rate & Alternative Income Trust, the XAI Madison Equity Premium Income Fund, and the Octagon XAI CLO Income Fund. In addition to investment advisory services, the firm also provides investment fund structuring and consulting services focused on registered closed-end funds to meet institutional client needs. XAI offers custom product build and consulting services, including product development and market research, marketing and fund management. XAI believes that the investing public can benefit from new vehicles to access a broad range of alternative investment strategies and managers. For more information, please visit Note: Net flows are reported in Form NPORT-P ('NPORTs'), which are filed quarterly with the SEC. NPORT filings are typically lagged 60 days from the end of the reporting period. The net flows data in this report is as of 3/31/2025 and represents the latest publicly available data. Sources: XA Investments; SEC Filings. Notes: All information as of 6/30/2025 unless otherwise noted. Total managed assets is inclusive of leverage. The non-listed CEF market is subject to lags in reporting and limited data availability. Data such as asset levels, net flows, and performance are delayed up to 90 days after quarter-end and are not available for all funds. All data in the report is the most current available. Please contact our team if you have any questions about the non-listed CEF marketplace.
Associated Press
15 hours ago
- Business
- Associated Press
XA Investments Reports Record $227 billion in Managed Assets in its Second Quarter 2025 Market Update
CHICAGO, July 22, 2025 (GLOBE NEWSWIRE) -- XA Investments LLC ('XAI'), an alternative investment management and consulting firm, announced today that its Non-Listed Closed-End Funds Second Quarter 2025 Market Update shows accelerated growth in the market, a surge in fund launches, and a shift toward greater investor accessibility. 'The non-listed CEF market continues to show record growth with 17% or 50 funds in the market reaching over $1 billion in assets under management and seven of those funds hitting the $1 billion milestone this quarter' stated Kimberly Flynn, the president of XAI. 'As more assets continue to flow into the interval / tender offer fund market, we believe the market's trajectory will remain positive, with significant opportunities for expansion throughout the rest of the year,' she added. The market update is a comprehensive research report detailing current market trends and industry highlights. The non-listed closed-end fund (CEF) market includes all interval and tender offer funds. The report highlights the removal of accredited investor suitability restrictions, divergence of positioning in the market, dominance of interval funds with a daily NAV and no suitability restrictions, increased performance coverage, and coverage of Specialty Structures. The non-listed CEF market reached a new peak with 288 interval and tender offer funds with a total of $196 billion in net assets and $227 billion in total managed assets, inclusive of leverage, as of June 30, 2025. The market includes 144 interval funds which comprise 59% of the total managed assets at $132.8 billion and 144 tender offer funds which comprise the other 41% with $93.9 billion in total managed assets. This is a significant change from previous quarters, as the number of interval funds has caught up to the total number of tender funds. In Q2 2025, 23 new funds entered the market, representing an increase of 13 funds compared to the 10 funds launched in Q2 2024. Market-wide net assets increased $15 billion in Q2 2025 from the prior quarter. In total, there are 150 unique fund sponsors in the interval and tender offer fund space, with 54 fund sponsors that have two or more interval and/or tender offer funds currently in the market. Additionally, there are 22 funds currently in the Securities and Exchange Commission registration process from fund sponsors looking to launch another fund. Displaying the growth of new funds in the market, the market share of the top 20 funds continues to decrease, falling to 59% in Q2 2025 from 60% in Q1 2025 and 65% in Q4 2024. Among the new funds launched in Q2 2025, there were nine new interval fund sponsors, including Corient, Coatue, and Select Equity Group. XAI also noted the emergence of Specialty Structures within the market. These funds are continuously offered, evergreen, semi-liquid private funds designed for accredited investors and qualified purchasers. They are exempt from the Investment Company Act of 1940 but still governed by federal securities laws. These evergreen funds provide access to alternative strategies while offering limited liquidity and reduced reporting obligations for the manager compared to registered funds. The current landscape of 13 Specialty Structures funds is dominated by large private equity firms including Blackstone, KKR, and Apollo. While Specialty Structures and interval / tender offer funds have some similarities, the fund structures differ in how they handle liquidity, investor eligibility, reporting obligations, and tax treatment. 'Understanding Specialty Structures helps managers better align product design with strategy and audience, which is increasingly critical in a growing and competitive market' Flynn said. In this quarterly report, XAI covers the Q1 2025 net flows which are lagged by reporting cycles. In Q1 2025 funds had positive net flows, totaling over $13 billion, with 67% of funds reporting positive net flows. The majority of net flows in Q1 2025 went into daily NAV funds without suitability restrictions, attracting 58% of marketwide net flows. Two-thirds or 67% of net flows went into funds with no suitability restrictions, while 12% went into funds limited to accredited investors, and 21% went into funds limited to qualified clients. In aggregate, the top 20 largest interval/tender offer funds accounted for 50% of total net flows including many of the market leaders such as the Cliffwater Corporate Lending Fund, Partners Group Private Equity (Master Fund), LLC, and ACAP Strategic Fund. 'The non-listed CEF market continues to grow with a total of 51 funds in the SEC registration process at the end of the first quarter,' Flynn noted. 'While the SEC backlog decreased by seven funds from the end of Q1 2025 to the end of Q2 2025, we believe there will still be significant growth in the market this year. So far in 2025, there have been 46 new SEC filings, compared to 27 new filings from this point in 2024, representing a 70% increase in registrations' she added. Newly launched non-listed CEFs spent around six months in the SEC registration process, with the fund's asset class continuing to be the main driver of time spent in the SEC review process. Tax-Free Bond funds were the quickest to launch, at 150 days on average spent in registration. At 53%, the majority of interval and tender offer funds do not have any suitability restrictions for investors imposed at the fund level — 27% of funds are available to accredited investors and 20% are only available to qualified clients. The amount of funds offered with no suitability restrictions is also predicted to increase with recent changes in a SEC Staff position. Following this change in position, many interval and tender offer funds have filed prospectus supplements removing accredited investor requirements. According to Flynn, 'We expect more funds to reduce their suitability requirements in the near future and for many new funds to forgo accredited investor requirements.' Alternative funds without suitability restrictions also prove to be more accessible and have gathered more assets at $130.5 billion in managed assets or 57% of market-wide assets. For more information on the interval fund market and to read our full quarterly report on non-listed CEFs, please visit the CEF Market research page linked here and click 'Subscribe' for access to XA Investments' online research portal and pricing information. In addition, please contact [email protected] or 888-903-3358 with questions. About XA Investments XA Investments LLC ('XAI') is a Chicago-based firm founded by XMS Capital Partners in 2016. XAI serves as the investment adviser for two listed closed-end funds and an interval closed-end fund, respectively the XAI Octagon Floating Rate & Alternative Income Trust, the XAI Madison Equity Premium Income Fund, and the Octagon XAI CLO Income Fund. In addition to investment advisory services, the firm also provides investment fund structuring and consulting services focused on registered closed-end funds to meet institutional client needs. XAI offers custom product build and consulting services, including product development and market research, marketing and fund management. XAI believes that the investing public can benefit from new vehicles to access a broad range of alternative investment strategies and managers. For more information, please visit Note: Net flows are reported in Form NPORT-P ('NPORTs'), which are filed quarterly with the SEC. NPORT filings are typically lagged 60 days from the end of the reporting period. The net flows data in this report is as of 3/31/2025 and represents the latest publicly available data. Sources: XA Investments; SEC Filings. Notes: All information as of 6/30/2025 unless otherwise noted. Total managed assets is inclusive of leverage. The non-listed CEF market is subject to lags in reporting and limited data availability. Data such as asset levels, net flows, and performance are delayed up to 90 days after quarter-end and are not available for all funds. All data in the report is the most current available. Please contact our team if you have any questions about the non-listed CEF marketplace.
Mint
01-07-2025
- Business
- Mint
Can diversifying into alternative investments help investors navigate market volatility? LGT Wealth's Viswanath explains
As the name suggests, alternative investments do not belong to conventional investment categories such as stocks or bonds but rather represent a diverse range of financial assets as private equity, private credit, hedge funds, real estate, venture capital, commodities and collectibles. These have grown in popularity in recent years, especially as investors seek to diversify their portfolios by allocating a portion of a portfolio to alternative investments and enhance the long-term investment only do alternative investments have the potential to diversify a portfolio of traditional assets but often deliver performance that is not correlated to traditional markets, helping investors navigate volatility. According to the recent industry reports, the alternative assets market in India currently estimated at $400 billion AUM is projected to grow 5x to $2 trillion over the next decade. Globally the alternative investments have reached an estimated $25 trillion AUM and continues to expand as the investors base and their allocations to private markets increase. Even though India today stands as the world's fourth-largest economy, alternative investments remain underpenetrated at just 4% of GDP, compared to over 10% of GDP in mature markets like the US and Europe with investors allocating as high as 20% of their portfolio to alternatives. This gap presents as a significant growth opportunity in India, especially as family offices, high-net-worth individuals (HNIs) and ultra-HNIs increasingly seek non-traditional, higher-yield assets. Indian investors are participating in alternative investments through allocation to AIFs (Alternative Investment Funds), REITs (Real Estate Investment Trusts), InvITs (Infrastructure Investment Trusts), offshore opportunities through GIFT City-based funds and international platforms. Each asset category has unique characteristics in terms of expected return, risk, yield, liquidity, and capital requirements that require a closer look to better understand the different benefits that it can bring to a portfolio. While some of the asset categories may serve more of a growth and capital appreciation purpose, others may protect portfolios against inflation and/or provide stable income. Some strategies may offer a combination. Historically, alternative investments have offered return premiums to investors willing to accept greater illiquidity and have been shown to meaningfully outperform public markets over time. While access to AIFs has been driven by a mix of macroeconomic, regulatory, and technological forces, yet alternative investments can present their own challenges, requiring an in-depth understanding of the space to evaluate and choose the alternatives suitable to risk profile of the investor. Our team harnesses its global knowledge and experience to carefully curate a set of high-conviction investment strategies in the alternatives space, designed to help investors in appropriate capital allocation. Investors who are beginning their journey in alternatives space can start with shorter tenure (average life of 5 to 7 years) private equity funds which invest in stable businesses with predictable exit scenarios and private credit funds which generates cash yield. This allocation can be enhanced to long tenure equity funds of 8 to 10 years, investing in stellar fund managers with a track record in the fund's investment strategy. There are many nuances in the selection of the fund manager including but not limited to characteristics like having skin in the game, ability to leverage their experience to back transformational companies poised for growth, navigate the market dynamics supporting the portfolio companies and generate the alpha over the investment horizon. Despite the steady growth in alternatives, one of the setbacks in the past few years has been slowdown in liquidity avenues for AIF investors on account of delayed exit options of the underlying portfolio entities of these AIFs. This is expected to improve in the following years as many of these entities will use vibrant capital markets and possible secondaries with wider participation and offer opportunities for investor exits. Investors who thoughtfully allocate to alternatives - balancing risk, liquidity, and long-term vision, could benefit significantly in the next decade. The author, Rajini Viswanath, is the CIO of Alternatives at LGT Wealth India. Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making investment decisions.
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Business Standard
15-06-2025
- Business
- Business Standard
AIF investments rise 32% to ₹5.38 trillion by March 2025, shows data
Rising volatility and evolving macro trends are driving HNIs to invest more in AIFs, which reached ₹5.38 trillion by March 2025, as they move beyond traditional asset classes New Delhi Investments in Alternative Investment Funds (AIFs) by India's high net-worth individuals (HNIs) rose to ₹5.38 trillion by the end of the March 2025 quarter, up 32 per cent from ₹4.07 trillion in the same period last year, according to data from the Securities and Exchange Board of India (Sebi). The increase is linked to rising market volatility and shifting global macroeconomic trends, prompting affluent investors to diversify their portfolios and reduce exposure to traditional asset classes. The move towards AIFs reflects a growing interest in investment options that provide broader risk management and are less correlated with public markets. These evolving market conditions are encouraging HNIs to move away from conventional assets like equities and fixed income instruments, according to a report by Multi-Act Trade and Investments, an investment advisory firm. AIFs are privately pooled investment vehicles regulated by Sebi, which invest in line with a defined strategy. They are classified into three categories: Category I includes venture capital and infrastructure funds; Category II covers private equity and debt funds; and Category III consists of hedge funds and other complex strategies. These funds are typically accessed by institutional and wealthy investors. The trend marks a notable shift in allocation strategies among HNIs and family offices, with many focusing on private market opportunities that allow for longer investment horizons. 'Family office portfolios have a really long horizon, so their ability to participate in private investments is much higher than most other investors,' the report stated. The appeal of AIFs lies in their potential to deliver higher returns and offer stability during periods of market stress. The surge in interest has been driven by the need for diversification, a hedge against inflation, and access to expert fund management. HNIs are investing across a wide range of segments including private equity, venture capital, credit strategies, real estate-focused AIFs, long-short hedge funds, and other portfolio management strategies. Younger investors, in particular, are showing interest in ESG-linked funds, climate-tech ventures, and sustainable finance vehicles.
Mint
15-06-2025
- Business
- Mint
AIFs gain traction as investments rise 32 pc to ₹5.38 lakh cr by March 2025
New Delhi, India's affluent investors are increasingly turning to Alternative Investment Funds , with investments in the space reaching ₹ 5.38 lakh crore by the end of the March 2025 quarter, a surge of 32 per cent from the year earlier. This increase is being driven by heightened market volatility and shifting global macroeconomic conditions, prompting the wealthy to seek more diversified and resilient portfolio options, according to investment advisory firm Multi-Act Trade and Investments. This trend marks a departure from the traditional equity-debt mix, as the country's affluent investors or High Networth Individuals move into the AIFs space, which include private equity, hedge funds, real assets, private credit, and other non-traditional instruments that typically have low correlation with public markets. The appeal of these alternatives is driven by their potential to offer higher returns as well as stability during periods of market stress. "As HNIs navigate persistent volatility, global macroeconomic shifts, and a low-yield environment, the demand for diversified and resilient portfolios is on the rise," Multi-Act noted. To support this view, Sebi data showed that cumulative investments in Indian AIFs surged 32 per cent year-on-year to ₹ 5.38 lakh crore in Q4 FY2025 from ₹ 4.07 lakh crore in Q4 FY2024. This suggests a clear shift in asset allocation strategy among HNIs and family offices. "Family office portfolios have a really long horizon, so their ability to participate in private investments is much higher than most other investors," the firm added, highlighting a key advantage that allows these entities to engage in alternative assets. Multi-Act attributed this increase to a combination of factors such as the need for diversification, a hedge against inflation, and access to expert management. AIFs have been divided into three categories I, II, and III covering early-stage venture capital, private equity, private credit, infrastructure, and long-short hedge strategies each offering a unique mix of risk, return potential, and liquidity. By allocating across these diverse strategies, HNIs can reduce their dependence on public markets, manage concentration risks more effectively, and build investment portfolios that are structurally more resilient across market cycles. Moreover, HNIs are allocating across a diverse range of alternative asset classes such as private equity & venture capital, real estate AIFs, hedge funds & PMS strategies, credit alternatives, and sustainable & impact alternatives. As per the investment advisory firm, many young affluents prefer ESG-themed AIFs, climate-tech venture funds, to blended finance vehicles and sustainable alternatives. According to Knight Frank Global Wealth Report 2025, India is now home to 85,698 individuals with assets exceeding USD 10 million. This accounts for 3.7 per cent of the world's ultra-wealthy population, positioning India fourth globally after the US , China , and Japan . This article was generated from an automated news agency feed without modifications to text.
