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Cache Exchange Fund Details
The 7-Year Timeline
How do redemptions from the exchange fund work BEFORE seven years?
How do redemptions from the exchange fund work BEFORE seven years?
Updated over a week ago

Exchange funds are for investors with a long-term investment horizon, and they require a seven-year commitment to earn tax benefits. However, there are times when investors need to redeem their shares early. Here’s how early redemptions work at different milestones:

0 to 2 years after contribution

With the Cache Exchange Fund, you won’t be able to redeem before two years. We institute a two-year lockup to encourage long-term investors to participate. Each pool is carefully weighted to achieve certain investment goals, and early redemptions hurt your fellow investors.

2 to 7 years after contribution

Between the end of the lockup and the fund’s maturation, early redemption requests are satisfied by distributing your original contribution back to you at a rate that is the lower of:

  1. The contributed stock value at the time of redemption

  2. Or the value of your exchange fund shares based on the fund’s net asset value.

Any remainder is retained until term commitments are met. Note that early redemptions incur a 2% penalty fee.

7 years after contribution

Once you are past the seven-year mark, you can redeem a diversified portfolio on a tax-deferred basis. No redemption fees are applicable after seven years, and your original cost basis carries over to the stocks you withdraw from the fund.

See more details about redemption AFTER seven years.

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