There Are Costs Involved
One main drawback to investing in interval funds is that they do have relatively higher investment management costs. This makes sense when you think about it. Less liquid asset classes require more due diligence, familiarity and monitoring; managers with this level of expertise demand higher fees.
When investing in any fund it is a good idea to make sure you understand the fee structure before you get involved. Some funds may look like a great investment because of their high rate of return or the performance history of the investment manager in that class of securities, but a lot of this can be eaten up by the extra costs involved. Your actual return from investing in an interval fund must be marginally high enough to offset the difference in fees.
Interval Funds Are a Good Investment
When you weigh all the pros and cons of investing in interval funds, they provide a good investment option for certain investors. Yes, the fees are higher than other funds, but the opportunity for additional return is also present.
