YieldStreet Alternative Income Fund (YieldStreet Prism Fund)

Available to: All investors; $10 000 minimum

Verdict

• ALIGNMENT: Below Average

  • The fund’s 1% management fee sounds competitive, but when all administrative and indirect costs are tallied, total annual expenses climb to 2.66%—high for most investors. There’s no performance fee, so managers don’t directly benefit when the fund outperforms, which blunts their incentive to deliver exceptional performance.
  • A key concern is that insiders have invested very little of their own capital into the fund. That lack of personal skin in the game means their financial interests aren’t fully tied to your outcomes—making it harder to trust they’re as invested in success as you are.

• Performance: Below Average

  • Since inception, the fund has returned 6.4%—moderate, but trailing similar private credit peers. While a 7.1% annual distribution yield appears strong, a portion comes from return of capital rather than pure investment income, signaling potential sustainability issues if income doesn’t rise to match payouts.
  • Management’s short track record in private credit raises doubts about their ability to deliver results through full market cycles. This makes it challenging to assess how the fund will perform over time, particularly in tough credit environments.

• Market Risk: High

  • Yieldstreet Prism takes on elevated market risk by allocating to unconventional assets such as private loans, legal settlements, and art-backed lending. These sectors are less correlated with the broader markets, offering both unique upside and greater uncertainty.
  • During periods of financial stress or volatility, these niche assets may become illiquid, suffer sudden revaluations, or face extended recovery times—meaning investors could see sharper swings in fund value than with mainstream credit allocations.

• Business Risk: High

  • Yieldstreet’s operational history includes legal disputes, SEC fines, and questions about governance, all of which raise business risk significantly. These past issues suggest a higher chance of process lapses or strategic missteps than in more established funds.
  • Investors should scrutinize ongoing management practices and board oversight closely. Governance weaknesses can directly jeopardize fund stability or reduce investor protections in times of market stress or organizational transition.

• Debt Risk: Above Average

  • The fund contains a mix of senior-secured loans and equity-like exposures, but granular information on the underlying borrower leverage and collateral coverage is limited. This lack of clarity makes it hard to assess the true level of downside risk.
  • Without thorough look-through data, investors face uncertainty on how well the fund’s assets could perform in an economic downturn, as well as what recovery rates might look like should defaults or restructurings occur in the underlying portfolio.

• Liquidity Risk: Above Average

  • Liquidity is tight: investors may only request redemptions quarterly, and even then, just 5% of fund assets are available for withdrawal each period. High demand could mean delayed or prorated payouts, or even redemption suspensions if conditions worsen.
  • Rapid or large-scale access to cash simply isn’t guaranteed. HENRY investors who may need to fund life changes or pursue new opportunities should weigh these exit constraints seriously before committing capital to this fund.

• Transparency: Low

  • The fund provides minimal look-through on holdings, making it hard to understand where risks and returns are coming from. Asset-level detail, borrower specifics, and performance drivers are not regularly disclosed to the public.
  • Response times and the quality of communication from investor relations are inconsistent, often leaving questions unanswered or handled in generalities. For investors wanting insight and hands-on oversight, this lack of transparency presents a major drawback and can complicate portfolio monitoring.

• Disclaimer

  All Rights Reserved. The data and analyses contained herein are the property of Noyack and are protected by copyright and other intellectual property laws. The information provided is intended solely for informational purposes and should not be construed as investment advice. It is not an offer to buy or sell a security, and it is not intended to be used as the sole basis for any investment decision. The information contained in this document is believed to be accurate and reliable based on sources believed to be reliable, but Noyack makes no representation or warranty, express or implied, as to its completeness, accuracy, or timeliness. The data and analyses are subject to change without notice and Noyack is not obligated to update this information. The use of the information contained in this document is at the sole risk of the reader, and Noyack shall not be responsible for any losses, damages, or expenses incurred by any person as a result of reliance on the information contained herein. Noyack does not endorse or approve any investment or trading strategy and does not guarantee any specific outcome or profit. The reader should always conduct their own independent analysis and consult with a qualified financial advisor before making any investment decisions. This document may contain forward-looking statements and projections which are subject to risks and uncertainties, and actual results may differ materially. Past performance is not indicative of future results. This document is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. Noyack reserves the right to modify or discontinue the provision of the information contained in this document, in whole or in part, at any time and without notice. The information contained in this document is provided “as is” and Noyack makes no representation or warranty of any kind, express or implied, as to the accuracy, timeliness, completeness, merchantability or fitness for any particular purpose of the information contained in this document. Noyack shall not be liable for any errors or omissions contained in this document or for any damages whatsoever arising out of or in connection with the use of this document.