What is an interval fund?
Answer: An interval fund is a closed-end investment fund whose shares typically do not trade on an exchange. Instead, it offers to repurchase a limited portion of outstanding shares at net asset value periodically, often quarterly. Unlike traditional mutual funds, it does not provide daily redemptions, and if redemption requests exceed the quarterly limit, often 5% of the NAV, investors can be restricted from selling all requested shares.
By Edward Papier, CIMA, CF2, CM&AA ยท Last updated November 5, 2026
Are interval funds closed-end funds?
Yes. Under the Investment Company Act of 1940, an interval fund is a type of closed-end fund. Unlike most closed-end funds, its shares usually do not trade on an exchange. Instead, the fund itself offers to buy back a set percentage of shares at regular intervals, typically every quarter, at the fund's net asset value.
What is a 40 Act fund?
A 40 Act fund is an investment fund registered with the SEC under the Investment Company Act of 1940. The group includes mutual funds, ETFs, closed-end funds and interval funds. Registration brings rules on disclosure, governance, custody of assets and limits on leverage. Many private funds are not registered, which is one reason they are usually limited to wealthier, accredited investors.
What is the difference between an interval fund and a tender offer fund?
Both are closed-end funds that offer limited liquidity instead of daily redemptions. An interval fund must offer to repurchase shares on a fixed schedule, usually quarterly, as a fundamental policy. A tender offer fund's board decides whether and when to make each repurchase offer. That gives tender offer funds more flexibility, and investors less certainty about when they can sell.
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Edward Papier, CIMA, CF2, CM&AA
President, Amadeus Wealth Alternatives, Hackensack, NJ
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