Vida Longevity Fund, LP’s Recent Valuations Causes Concerns

What is the Vida Longevity Fund?

The Vida Longevity Fund, LP (VLF) is an open-ended hedge fund. It is involved in non-correlated investment strategies that are insurance-linked and concentrated in longevity-contingent risks. The Fund was Launched by Austin, Texas-based asset management company Vida Capital, Inc. in 2010.

The Fund invests primarily in insurance products, including life settlements, structured settlements, and annuities. Unfortunately, there is growing concern that Vida Capital may have been improperly valuing its assets. There are also concerns that some brokerage firms and their registered representatives misrepresented the risks involved in Vida Longevity Fund.

Brokers may have unsuitably recommended the Fund to retail investors, retirees, inexperienced investors, and conservative investors. These are investors who are usually unable or unwilling to take on much risk.

They may also have failed to conduct proper due diligence to ensure the accuracy of the Vida Longevity Fund's valuations. Even as they earned high fees and commissions from selling this hedge fund to customers.

Our securities fraud lawyers at Shepherd Smith Edwards and Kantas are speaking with investors who sustained losses from this investment.

High Fees & Commissions Provide Incentive for Brokers to Market & Sell Vida Longevity Fund 

Vida Longevity Fund offers three share classes that charge substantial fees:

  • Class A Shares charge a 5% incentive fee and a 2% management fee
  • Class B Shares charge a 10% incentive fee and a 1.5% management fee
  • Class C Shares charge an up to 15% incentive fee and a 1.75% management fee

Vida Longevity Fund is clearly not for your typical retail or conservative investor. Class A Share investors reportedly must invest $510K at minimum. Investors of the other two class shares must reportedly invest at least $225K each.

By 2018, more than 3,600 investors had reportedly invested nearly $1.2B in the Fund since its 2010 inception. An early prospectus promised yearly returns of 10-14% and liquid profits every quarter.

Recent Changes to Vida Longevity Fund's Valuation Processes Raise Red Flags

Unfortunately, returns for Vida Longevity Fund have been substantially lower than in previous years. This downturn happened even before COVID-19 struck in 2020 and wreaked havoc on the markets.

In April 2020, the Fund announced changes to its valuation processes and acquired a company to improve its algorithmic processes. In October 2020, Vida Longevity Fund said it was modifying its management structure. It would also conduct an "exhaustive review" of its underwriting and portfolio management practices.

It also noted that it would be revising life expectancy reports on old policies. This was done so they would be more in line with current and projected mortality rates. One cannot help but wonder why these changes were necessary and what this says about past valuations and their accuracy.

These activities have raised concerns that Vida Longevity did not value the Fund's assets correctly. If this is the case, your investment may be worth less than you think.

Alternative Investments are Complex, Risky Investments

Vida Longevity Fund is a complex, alternative investment. Like all alternative investments, it is risky, illiquid, and better suited for sophisticated investors. Some examples of sophisticated investors are high net worth individuals and institutional investors.

It is also important to note that sophisticated investors may have been unsuitably recommended this investment by their brokerage firm. In that instance, they would also suffer unnecessary and significant investment losses as a result of such recommendations.

Experienced Vida Longevity Fund Investor Law Firm

Contact SSEK Law Firm today if you are a Vida Longevity Fund investor interested in exploring your legal options.

Our broker fraud lawyers have spent more than 30 years fighting for retail investors, retirees, high-net-worth individuals and institutional investors.

We have represented thousands of clients, collectively recovering millions on their behalf. Contact us online or call (866) 901-3775 to discuss your Vida Longevity Fund investor claim.

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