Sound Point Capital Management and Skypoint Capital Advisors have launched a multi-asset credit interval fund that will focus on core middle market direct lending, which offers “stronger structural protections”.
The Sound Point Alternative Income Fund (SAFTX) will invest in a range of private and alternative credit strategies managed by Sound Point across its $45bn (£33.3bn) integrated credit platform, with the aim to generate income.
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The fund’s focus on core middle market direct lending will be complemented by private asset-based capital solutions and specialty finance, “while retaining the flexibility to opportunistically allocate to liquid credit when relative value is compelling”, the global alternative credit manager said.
SAFTX will seek to mitigate risk by allocating across a diversified range of credit asset classes that are backed by both contractual cash flows, and hard and specialty financial assets.
The interval fund structure provides quarterly liquidity via repurchase offers of at least five per cent of outstanding shares, quarterly income distributions and daily net asset value pricing.
SAFTX will be managed by a team at Sound Point that includes Tom Newberry, chief credit officer and executive chairman of direct lending, Gunther Stein, head and chief investment officer of US performing credit, and Jane Lawrence, US collateralised loan obligation (CLO) and senior floating rate portfolio manager.
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“The core middle market continues to offer stronger structural protections and more attractive spreads than the increasingly crowded large-cap direct lending market,” said Newberry. “Our edge lies in our selectivity and discipline. We invest in only a small percentage of the opportunities we evaluate, while maintaining the ability to deploy capital opportunistically.”
According to Stein, during periods of market dislocation when relative value can shift rapidly, liquid credit plays an important role within the strategy.
“Our scale across performing credit and CLOs provides continuous insight into issuer fundamentals, sector dynamics, and capital structures, enabling us to allocate capital with precision across markets,” Stein added. “That flexibility enhances liquidity, supports risk management, and complements the fund’s diversified private credit foundation.”
Sound Point’s strategies span liquid and illiquid credit alternatives and include funds and managed accounts focused on leveraged loans, special situations, distressed debt, structured credit, direct lending, and commercial real estate.
Investment advisor Skypoint Capital Advisors provides financial advisors and investors with access to a roster of institutional-quality managers with expertise in specialist asset classes.
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