SEI has launched The Advisors’ Inner Circle Fund (AIC) III with an eye towards helping managers of private funds enter the retail space.
AIC III is the third series trust in the AIC platform that SEI first introduced over 20 years ago and was developed to provide managers with a turnkey solution for the operations of retail mutual funds.
This solution included an independent board of trustees, compliance programme, fund administration, accounting, investor servicing, and distribution services.
AIC III combines the size of SEI’s series trust platform and SEI’s background in alternative services with a new fund board experienced in the alternative investment market. The new series trust accommodates sophisticated alternative strategies for US and non-US managers who want to enter the US market.
“While many managers of private funds want to take advantage of the burgeoning opportunities in liquid alternatives, they are not always equipped to deal with the intricacies of mutual fund governance, distribution, and regulation,” says John Alshefski (pictured), senior vice president of SEI’s investment manager services division. “Our Advisors’ Inner Circle series trust lets managers of private funds jump into the regulated fund market without the expense and lead time involved in setting up their own infrastructure. Our expertise in alternative asset servicing also means we know the challenges our clients face, and puts us in a unique position to help guide our clients into the retail space.”
A recent SEI white paper, Private Fund Managers and the Retail Alternatives Phenomenon, cited that a number of high-profile managers of private fund have already launched or filed for retail products. Net new flows to alternative mutual funds more than doubled in 2013, totalling USD40.4bn, equivalent to 12.5 per cent of all mutual fund flows for the year, according to Strategic Insight. By the end of the year, 411 alternative funds were available, according to Morningstar, compared with the 165 alternative funds available five years earlier.
“To succeed in the retail arena, managers of private funds need access to distribution networks and platforms they may have not had to deal with before,” says Mike Beattie, vice president of SEI’s investment manager services division and president of its Advisors’ Inner Circle platform. “They also need a seasoned fund board that can anticipate the complexities involved in bringing alternative strategies into the mutual fund world. Our series trust provides immediate access to those resources.”