Redemption Service

Provides liquidity to offset shareholder redemptions, insulating funds from the detrimental effects of shareholder flow.

With ReFlow’s redemption service funds have a “benevolent shareholder”; one that will purchase shares in the fund to offset shareholder redemptions and then redeem positions concurrent with new shareholder subscriptions.

Redemption Service Advantages

  • Less costly and time consuming than selling securities to raise cash. ReFlow insulates funds from costs and risks of forced trading, lowering expenses for all shareholders.
  • Increases tax-efficiency by helping avoid forced selling due to redemptions.
  • More accessible and cost-effective than lines of credit, which can be hard to secure and involve significant setup and maintenance fees.
  • Proactive and consistent rather than reactive. ReFlow goes into effect without delay whenever net outflows are experienced.

How it Works

ReFlow’s Redemption Service utilizes the mechanisms funds already have in place. No changes to existing operations are required once the service is set up.

  • Capital is allocated through a Dutch Auction process, just like T-Bills and US Treasuries.
  • Participation can be fully automated so that a standing bid is triggered whenever a preset amount, or percentage, of net outflow in the fund is reached.
  • The minimum bid is 20 basis points; highest bids are filled first.
  • ReFlow’s position will be redeemed into any net shareholder subscription. Any remaining ReFlow position will be redeemed in cash or, for qualifying funds, with securities “in-kind” anytime within 14 days.
  • No set-up or maintenance charges. Fees are transaction-based, transparent, and qualify as a bona-fide fund expense.
  • Mutual fund board approval is required.

A Look at the “In-Kind” Feature of Redemption Service

Once ReFlow has established a position in a fund, certain qualifying mutual fund participants may request their redemptions to be paid “in-kind” with securities when redeeming ReFlow. Funds have up to 14 days to redeem ReFlow’s position with a basket of securities. This in-kind redemption option allows funds to lower taxable distributions by redeeming ReFlow’s position with low-cost-basis securities.

get in touch

650 California Street
Suite 2700, San Francisco, CA 94108
Phone: (866) 473-3569

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Thanks for your interest in ReFlow Fund, which provides mutual funds with short-term liquidity and tax solutions. Founded by Mr. Gordon Getty in 2002, ReFlow Fund is designed to track the S&P 500 Index leveraging its patented operational structure, and outperform this Index with the fee income it generates from ReFlow Fund's liquidity and tax services. The investment manager of ReFlow Fund, ReFlow Services, LLC, manages all day-to-day operations.

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