Blackstone, Vanguard, Wellington fire first joint shot into interval fund space

Several weeks after first announcing a landmark three-way partnership, Wellington Management, Vanguard Group. and Blackstone have filed to launch a multi-asset interval fund aimed at bringing private markets exposure to a wider base of retail investors.

According to a filing with the Securities and Exchange Commission dated May 7, the WVB All Markets Fund will be structured as an interval fund – an investment vehicle that allows limited quarterly redemptions of between 5 percent and one-fourth of the fund’s net asset value.

The filing stated that Wellington will act as the fund’s investment adviser.

“Wellington, as the adviser, will be making investment and allocation decisions," said Dan Sotiroff, senior manager research analyst at Morningstar, which this week announced a new methodology to evaluate semiliquid fund products. "Vanguard and Blackstone are essentially just providing access to their respective investment funds.”

The fund’s strategy will blend public equities, fixed income and private market investments. The portfolio may invest up to 60 percent in public equities though allocations to Vanguard funds and direct investments by Wellington. On the fixed income side, it can have up to 30 percent via Vanguard fund allocations. It's also able to allocate as much as 40 percent of net assets in private investment funds managed by Blackstone. 

No management fees were specified in the filing. However, it noted a minimum initial investment of $2,500 for I, A, and M share classes of the funds.

It was in mid-April that Wellington Management, Vanguard, and Blackstone announced their tripartite agreement to develop simplified, multi-asset investment solutions that would blend public and private market assets. That followed whispers of Vanguard holding exploratory talks with potential partners for private investment tie-ups, which rumor had it included Carlyle Group.

"Vanguard’s funds are already publicly accessible, so it isn’t clear why it chose to form an alliance with Wellington and Blackstone," Sotiroff commented.

Wellington, Vanguard, and Blackstone are "committed to collaborating on the development of simplified multi-asset investment solutions that seamlessly integrate public and private assets as well as active and index strategies,” a Wellington representative said in a Bloomberg report covering the filing.

The fund marks the first collaboration between the firms since announcing a partnership earlier this year. It also reflects growing interest among traditional and alternative managers in expanding private market access to individual investors.

Vanguard and Wellington have only recently begun building out their private markets capabilities. Blackstone, meanwhile, offers several private investment strategies geared toward retail channels.

Amid a growing push to democratize private-market investments, interval funds have become a common route for asset managers aiming to bridge the gap between institutional-grade alternatives and retail capital. By offering infrequent liquidity and long holding periods, these vehicles are generally seen as better suited to the illiquid nature of private investments such as real estate, direct lending or private equity.

“This is the latest attempt to merge public and private assets together to provide greater access to private investments,” Sotiroff said, noting that such funds "won’t be a great fit for a lot of investors" owing to their lengthy lock-up periods and "limited opportunities to redeem shares for cash.”

And while the WMV All Markets fund may offer a new diversification tool for financial professionals and clients, investor education and transparency may be key considerations to their broader adoption.

“They’re more opaque than mutual funds or exchange-traded funds, so investors won’t necessarily know what they’re invested in,” Sotiroff said.

Author's note: An earlier version of this story erroneously stated Blackstone and Vanguard are subadvisors to the fund. The piece has been updated to correct that.