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XA Investments LLC (“XAI”) SUBSCRIPTION SERVICE TERMS AND CONDITIONS

These XAI Subscription Service Terms and Conditions (the “Terms”) together with the applicable subscription order form or invoice (the “Order Form”, collectively with the Terms, the “Agreement”), set forth the terms and conditions governing the access to and use of the Service by the licensee entity set forth in the Order Form (the “Licensee”). The term “Service” means certain compiled data, content, and information, documentation, and functionality provided by XAI to Licensee through a subscription service and further described in the Order Form. The term “Order Form” includes any electronic order form made available to Licensee by XAI for the Service.

BY EITHER EXECUTING AN ORDER FORM THAT REFERENCES these terms OR ELECTRONICALLY ACCEPTING THIS AGREEMENT BY CLICKING A BOX INDICATING ACCEPTANCE, LICENSEE AGREES TO THE TERMS OF THIS AGREEMENT and REPRESENTS AND WARRANTS THAT (a) THEY ARE OF LEGAL AGE AND CAPACITY TO ENTER INTO A BINDING AGREEMENT; AND (b) IF LICENSEE IS A LEGAL ENTITY, THAT THEY HAVE THE RIGHT, POWER, AND AUTHORITY TO ENTER INTO THIS AGREEMENT ON BEHALF OF LICENSEE AND BIND LICENSEE TO ITS TERMS. IF LICENSEE DOES NOT AGREE WITH THE TERMS OF THE AGREEMENT, LICENSEE MAY NOT ACCEPT THIS AGREEMENT AND MAY NOT USE THE SERVICES.

  1. ACCESS RIGHTS. During the Term, and subject to and conditioned on Licensee's payment of the applicable license fee and compliance with these Terms, XAI hereby grants Licensee a non-exclusive, non-sublicensable, and non-transferable right to access and use the Service solely for Licensee’s internal business purposes (the “Permitted Use”). Access to the Service may be subject to registration of a username and password by Licensee and its end users through XAI’s online registration systems. Licensee shall protect and keep confidential such access credentials and ensure that its end users do not share any access credentials with any other user or any other third party. Licensee is responsible for all activity occurring under such access credentials of Licensee and its end users.
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XA Investments’ First Quarter 2026 Report Shows Interval Fund Market Expands in the Face of Liquidity Concerns

Investor Accessibility and Contractual Liquidity Provisions Favor Interval Funds Over Tender Offer Funds

CHICAGO, April 15, 2026 – XA Investments LLC (“XAI”), an alternative investment management and consulting firm, announced the publication of its latest research report, the XAI Non-Listed Closed-End Fund First Quarter 2026 Market Update. The report covers interval fund market trends and recent developments for the period ended 3/31/26, with expanded coverage of credit funds and market wide redemption data.

“The interval and tender offer fund market has reached a new peak in the first quarter with 314 funds and $247 billion in net assets, driven by new firms entering the market and the breadth of private market strategies on offer,” stated Kimberly Flynn, the president of XAI.

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 new fund sponsors entering the interval fund market, fund conversions from tender offer fund to interval fund, notable new fund launches, and net flow statistics.

“Our research team has observed several new market trends including funds converting from tender offer fund to interval fund, additional funds removing suitability restrictions, and increased shareholder demand for liquidity,” Flynn said. Additionally, XAI is tracking closely the growth of the evergreen “Specialty Structures,” continuously offered evergreen operating companies and private funds that offer periodic liquidity and are designed to be sold into the private wealth marketplace. Notably, two new Specialty Structures by BlackRock’s HPS launched in Q1.

Market Overview

The non-listed CEF market includes 173 interval funds, which comprises 57% of the total managed assets at $156 billion, and 141 tender offer funds which comprises the other 43% with $116 billion in total managed assets. In Q1 2026, eight new funds entered the market, fewer launches than Q1 2025 likely due to backlogs in the SEC registration process from the 2025 Federal government shutdown. Market-wide net assets increased $14 billion.

The number of interval funds in the market has continued to outpace the number of tender offer funds, with all eight new funds in Q1 2026 launching as interval funds. In addition, 13 tender offer funds have converted, or plan to convert, into interval funds. The propensity for interval funds by fund sponsors is driven in part by financial advisor preferences for electronic ticketing and a preference for quarterly redemptions and contractual liquidity provisions.

“The number of funds in the SEC registration process increased by five funds from 50 at the end of 2025 to 55 at the end of Q1 2026. This shows the consistent momentum of the market from fund sponsors,” Flynn noted. “Both new fund registrations and fund launches were slower than expected in Q1 2026 with the backlog of funds still around from the 2025 Federal government shutdown.” Newly launched non-listed CEFs spent around ten months in the SEC registration process, with the fund’s primary investment strategy continuing to be the main driver of time spent in the SEC review process.

Venture / Private Equity funds surprisingly were the quickest to launch at around six months in SEC registration on average.

Fund Sponsors & Market Leaders

In total, there are 159 unique fund sponsors in the interval and tender offer fund space, remaining the same as the end of 2025, and there are 58 fund sponsors that have two or more interval and/or tender offer funds currently in the market. Additionally, there are 25 funds in the SEC registration process from fund sponsors seeking to launch additional funds and 30 sponsors seeking to launch their first fund.

Only three fund sponsors have more than one fund on the top 20 funds by total managed assets (Cliffwater (3), Carlyle (2), and StepStone (2)), displaying the diversity in the interval fund market. In aggregate, the top 20 largest interval and tender offer funds accounted for 51% of total net flows in 2025, including many of the market leaders such as the Cliffwater Corporate Lending Fund, Partners Group Private Equity, LLC, and ACAP Strategic Fund.

In 2025, 73% of interval and tender offer funds had positive net flows, with market wide net flows totaling over $60bn, increasing 56% in net flows year-over-year. Notably, the Venture / Private Equity fund net flows surpassed credit fund net flows for the first time in Q4 2025, delivering almost $6bn in net flows compared to credit’s $5.6bn.

Liquidity Concerns & Redemptions

While fund net flows have been positive, redemption requests have made headlines in the BDC market and the interval fund market. Credit funds had the highest redemptions of any asset class in the interval fund market, averaging -3.09% for Q4 2025 for the ratio of redemptions to average net assets. The Cliffwater Corporate Lending Fund and the Carlyle Tactical Private Credit Fund, two of the largest credit funds, announced large Q1 2026 redemption requests, despite reporting stable portfolio performance and low default rates.

The recent headlines surrounding liquidity concerns in direct lending interval funds and BDCs give market leaders the opportunity to pause and consider potential industry improvements. XAI believes it would be helpful for fund sponsors to address the fundamental differences in product structures with respect to key matters such as liquidity.

“We have fielded input from consulting clients regarding the confusion resulting from grouping and labeling of ‘semi-liquid’ funds together (interval funds, tender offer funds, non-listed BDCs and non-listed REITs) which can confuse investors on the liquidity provisions of the different product types,” Flynn noted. For example, an interval fund may be subject to proration but cannot be gated.

In the quarterly report, XAI advocates for improved advisor and investor education on interval funds including sales practice focus on the long-term nature of private markets investing, and enhanced marketing material disclosures that are prominent with respect to limited liquidity provisions. The long-term health and wellness of the interval fund marketplace and the growth of alternatives in the private wealth markets will be supported by these collective efforts.

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.

For more information, please visit www.xainvestments.com

CONTACT:
Kim Shepherd
kshepherd@xainvestments.com
312-623-5123

Sources: XA Investments; CEFData.com; SEC Filings.

Notes: All information as of 3/31/2026 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.

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