The limited window lets the fund hold genuinely illiquid assets, such as private credit, real estate or litigation finance, without the mismatch that forces an open-end-fund to sell into weakness. Investors trade daily access for exposure to an illiquidity-premium.
The binding constraint appears when demand to exit exceeds the offer. If 20% of shares are tendered into a 5% repurchase, each investor gets a quarter of their request filled and waits for the next window. In a sustained sell-off that can mean a year or more to exit fully.
Fees are typically higher than listed funds, and valuations rest on appraisals rather than market prices, so reported volatility understates true economic volatility. Read the repurchase policy and the valuation methodology before the liquidity is needed, not after.
Related: open-end-fund, closed-end-fund, illiquidity-premium, redemption-gate, net-asset-value, private-credit