LTAFs yet to take off for retail investors

The arrival of the Schroders long-term asset fund on Hargreaves Lansdown’s platform for self-invested personal pension investors two months ago may have given the new semi-liquid structure a big thumbs-up for the retail investor.

But they have not yet taken off as a private markets wealth structure, with only a few of the dozens of LTAFs registered with the Financial Conduct Authority targeting individual investors. Of the 25 sub-funds approved by the FCA, only six — from five managers — are currently targeting wealth investors, whether ‘wealth’ or ‘retail’, according to FT Adviser research.

The five managers are: Schroders, Fidelity, WTW, Partners Group and Arcmont; Aegon may open up to individual investors in time.

The main issue is that LTAFs are very UK focused, and cannot be passported across Europe, although they can act as a feeder fund into a European fund. 

There is also a market issue in the UK, where attitudes to private markets are somewhat mixed, and retail investors feel more comfortable with the liquidity of private markets investment trusts.