XA Investments Reports Record $227 billion in Managed Assets in its Second Quarter 2025 Market Update
Interval and Tender Offer Fund Market Experiences Accelerated Growth, Surge in Fund Launches, and Shift Toward Greater Investor Accessibility
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@xainvestments.com 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 www.xainvestments.com.
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; CEFData.com; 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.
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