The mass sales pitching of private equity and credit seems to be accelerating and I don't think it will slow down in the near future. For the record, I do not think this will end in widespread catastrophe, I think more like it will just wither away as having been a lot of hype about nothing or at least very little similar to the manner that ESG is withering or similar to the even shorter arc for direct indexing.
My work email gets bombarded with solicitations for private whatever including the occasional email about an interval fund. Last week I got one about the Calamos Aksia Alternative Credit and Income Fund (CAPIX). CAPIX is an interval fund.
Part of my conclusions about these is that chances are, whatever you're trying to do, can probably be done cheaper and easier with better liquidity and transparency than the interval wrapper. The fact that we are talking about an interval fund shows my willingness to keep learning and keep an open mind, similar to crazy high yielding derivative income funds and portable alpha funds.
The blue line and shaded area is CAPIX and the other three are the three catastrophe bond mutual funds I am aware of. The ILS ETF just started trading earlier this year so I didn't include it.
PRIVX is a private equity interval fund. If you have interest private equity, what are you hoping it does?
Yes, it's just one fund and maybe it is the single worst equity interval fund in existence but it doesn't take any keen skill to pick a broad based tech sector fund like XLK for the slice of an equity portfolio that is expected to outperform. Contrast that with something like staples or utilities that probably won't outperform but should help manage volatility.
The quick and dirty with interval funds is just don't. At least not yet.
The information, analysis and opinions expressed herein reflect our judgment and opinions as of the date of writing and are subject to change at any time without notice. They are not intended to constitute legal, tax, securities or investment advice or a recommended course of action in any given situation.
No comments:
Post a Comment